--- title: Get Money Back for Going Geothermal description: For tax years beginning on or after January 1, 2026, taxpayers who meet certain income requirements may elect to receive any unused credit amount as a refund. image: https://www.energycatalysttech.com/hubfs/EC.png --- [Skip to content](https://www.energycatalysttech.com/blog/get-money-back-for-going-geothermal#main-content) [![Energy Catalyst Ground Breaking Clean Heat](https://www.energycatalysttech.com/hs-fs/hubfs/energy-catalyst_logo.webp?width=400&height=122&name=energy-catalyst_logo.webp)Homepage](https://www.energycatalysttech.com) - [Residential](https://www.energycatalysttech.com/residential-geothermal-heating-and-cooling/) - [Commercial](https://www.energycatalysttech.com/commercial-geothermal-heating-and-cooling/) - [Installer](https://www.energycatalysttech.com/installer-geothermal-heating-and-cooling/) - [Our Products](https://www.energycatalysttech.com/double-hybrid-heat-pump/) - Resources - [About](https://www.energycatalysttech.com/about-us/) - [How Geothermal Works](https://www.energycatalysttech.com/how-geothermal-works) - [Cost Savings & Benefits](https://www.energycatalysttech.com/geothermal-cost-savings-and-benefits/) - [News](https://www.energycatalysttech.com/energy-catalyst-news) - [Blog](https://www.energycatalysttech.com/blog) [Savings Calculator](https://estimate.energycatalysttech.net/) - [Residential](https://www.energycatalysttech.com/residential-geothermal-heating-and-cooling/) - [Commercial](https://www.energycatalysttech.com/commercial-geothermal-heating-and-cooling/) - [Installer](https://www.energycatalysttech.com/installer-geothermal-heating-and-cooling/) - [Our Products](https://www.energycatalysttech.com/double-hybrid-heat-pump/) - Resources - [About](https://www.energycatalysttech.com/about-us/) - [How Geothermal Works](https://www.energycatalysttech.com/how-geothermal-works) - [Cost Savings & Benefits](https://www.energycatalysttech.com/geothermal-cost-savings-and-benefits/) - [News](https://www.energycatalysttech.com/energy-catalyst-news) - [Blog](https://www.energycatalysttech.com/blog) [Savings Calculator](https://estimate.energycatalysttech.net/) ![Geothermal](https://www.energycatalysttech.com/hs-fs/hubfs/EC.png?width=1240&height=918&name=EC.png) # Get Money Back for Going Geothermal ![Matt Desmarais](https://7528315.fs1.hubspotusercontent-na1.net/hub/7528315/hubfs/raw_assets/public/mV0_d-cms-elevate-theme_hubspot/elevate/images/avatar-placeholder.jpg?width=48&height=48&name=avatar-placeholder.jpg) Matt Desmarais October 13, 2026 A Homeowner's Guide to New York's Geothermal Tax Credit Did you know that New York State will pay homeowners back up to $10,000 for installing a geothermal heating and cooling system at your home? With heating oil now above $6 a gallon, according to NYSERDA, the math on switching has never been better. This guide explains what the credit is, what's new in 2026, and how easy it is for homeowners to make the switch to geothermal heating and cooling with Energy Catalyst. **What is the Geothermal Energy System Credit?** The Geothermal Energy System Credit is a New York State income tax credit equal to 25 percent of what you spend on a qualifying geothermal system at your home. The credit is capped at $10,000 for systems placed in service on or after July 1, 2025 (systems finished earlier were capped at $5,000). In real numbers: a $40,000 qualifying system earns the full $10,000. A $24,000 system earns $6,000. You can claim one geothermal system per tax year. The state's own definition of a geothermal system is a ground source heat pump, which uses heat stored in the ground or in bodies of water. That's exactly the kind of system Energy Catalyst designs and builds. Learn more about our products [here](https://www.energycatalysttech.com/double-hybrid-heat-pump/). **New in 2026: You Can Take Unused Credit as a Refund** A tax credit only helps if you owe enough tax to use it. If your credit is $10,000 but your New York State income tax is $4,000. You use $4,000 that year, and the other $6,000 is "unused." Until now, that unused amount could not be refunded. You could only carry it forward for up to five years, and then it expired. For tax years beginning on or after January 1, 2026, taxpayers who meet certain income requirements may elect to receive any unused credit as a refund. The income requirements are: - **$180,000** for married taxpayers filing jointly - **$90,000** for single taxpayers In the example above, an eligible homeowner could take the remaining $6,000 as money back instead of waiting years to use it up. If you're near those income numbers, ask your tax preparer exactly how the credit rules applies to you. The state's instructions for 2025 returns still describe the older carry-forward rule, so the 2026 form and instructions are the place to confirm the details. **What Counts, and Who Can Claim It** Most of what goes into getting a system running is eligible. According to the state's [IT-267 instructions](https://www.tax.ny.gov/forms/current-forms/it/it267i.htm), qualifying costs include: - Materials and equipment - Labor for on-site preparation, assembly, and installation - Architectural and engineering services - Designs and plans tied directly to the installation Three things don't count: amounts paid with nontaxable grants, interest or other financing charges, and costs you used to qualify for another credit. If you're also getting rebates, ask your tax professional how they affect your number. To qualify, the system must be installed at your New York State residence, be in service there, and be used for personal purposes. The home must be your residence when the system goes into service, and you can't claim the credit for a year in which the home is rented out at any point. A few other situations are covered too: - **Leased or service-agreement systems:** you may claim the credit if you have a written lease with someone other than yourself for at least 10 years. The credit applies to the first 15 years of the lease. - **Condo owners and co-op shareholders:** you claim your share of the costs, which your management association should provide. - **Shared homes:** the credit is divided by each person's share of the cost. Married couples filing jointly don't split it. **How to Claim It: Four Steps** Claiming the credit is a matter of one form and a few lines on your regular return. 1. **Keep your paperwork.** Save your contract, invoices, and proof of the date the system went into service. Your installer should be able to provide an itemized breakdown of materials, labor, and design costs. 2. **Fill out Form IT-267.** On Schedule A, list your qualifying costs and multiply by 25 percent. 3. **Work out how much you can use.** On Schedule B, enter your New York State tax and any credits already applied. The form shows how much of the credit you use this year and how much is left over. 4. **Attach it to your return.** Enter the credit amount with code **267** on Form IT-201-ATT, line 6 (if you file Form IT-201), or Form IT-203-ATT, line 7 (if you file Form IT-203). If you have credit left over, you now have a decision to make: carry it forward, or, if you meet the income requirements for tax years beginning in 2026 or later, elect to receive it as a refund. Your tax preparer can help you pick the better option for your situation. *This guide is general information, not tax advice. Your tax professional can confirm how the credit applies to you.* **Make the Credit Work for You** The credit has never been this generous: the cap doubled to $10,000 for systems placed in service on or after July 1, 2025, and starting in 2026 eligible homeowners can take any unused portion as a refund instead of waiting. Combined with oil prices above $6 a gallon, the cost of staying put keeps rising. Energy Catalyst designs, manufactures, and installs its own geothermal systems in New York, and offers two ways to buy: an outright purchase, or an Energy Services Agreement with low, predictable monthly payments over 15 years. The agreement is written to preserve your right to claim this credit if you qualify, so ask your tax professional how it applies to your situation. The next step is simple. [Get a free estimate](https://estimate.energycatalysttech.net/) to see what a system would cost for your home, and what the 25 percent credit would be worth to you. When you're ready, [request a site assessment](https://www.energycatalysttech.com/residential-geothermal-heating-and-cooling/) and we'll walk you through both options side by side. Source: [https://www.tax.ny.gov/forms/current-forms/it/it267i.htm](https://www.tax.ny.gov/forms/current-forms/it/it267i.htm)   ## Share this post [mailto:https%3A%2F%2Fwww.energycatalysttech.com%2Fblog%2Fget-money-back-for-going-geothermal](mailto:https%3A%2F%2Fwww.energycatalysttech.com%2Fblog%2Fget-money-back-for-going-geothermal) ## Keep reading ### [![](https://www.energycatalysttech.com/hs-fs/hubfs/energy-catalyst-manufacturing-clean.png?width=1451&height=1084&name=energy-catalyst-manufacturing-clean.png) What Is Geothermal EaaS?](https://www.energycatalysttech.com/blog/what-is-geothermal-eaas) ### [![Energy Catalyst](https://www.energycatalysttech.com/hs-fs/hubfs/undefined-2.jpeg?width=1023&height=1533&name=undefined-2.jpeg) Best Heating Systems for Cold Climates](https://www.energycatalysttech.com/blog/best-heating-systems-for-cold-climates) [![energy-catalyst\_logo](https://www.energycatalysttech.com/hs-fs/hubfs/energy-catalyst_logo.webp?width=266&height=81&name=energy-catalyst_logo.webp)](https://www.energycatalysttech.com) Precision-engineered geothermal technologies for sustainable thermal comfort. 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