Save Big On Taxes While Upgrading Your Home
As part of Section 25C of the Inflation Reduction Act, you can access the Federal Energy Efficient Home Improvement Tax Credit by installing a qualified heat pump in your home! With the capacity to both heat and cool your home, and ideally suited for California's climate, a heat pump provides the best of both comfort worlds while limiting your environmental impact.
Interested in earning this tax credit or have more questions? Contact the team at Cool Air Solutions online or at 951-234-0748 today!
What Credits Are Available?
Under the Federal Energy Efficient Home Improvement Tax credit, you can receive the following tax credits:
- 30% of the total installed project costs for qualifying heat pumps or other equipment
- Capped at $3200/year per household:
- 30% of the total project up to $2000 for heat pump HVAC
- 30% of the total project up to $2000 for heat pump water heater
- 30% of the total project up to $1200 for energy-efficient conventional AC or furnace
- 30% of the total project up to $1200 for energy-efficient insulation
What Are The Eligibility Requirements?
To claim this credit, you must meet the following criteria:
- Available to homeowners who install qualifying ENERGY STAR® certified air-source heat pumps
- Equipment must meet minimum efficiency standards: specific SEER2, HSPF2, and COP5 ratings
- Only applies to primary residences in the United States
- Taxpayer must have a tax liability to claim the credit
Important Information On This Program
When considering an install under this program, keep the following in mind:
- This is not a rebate, but a tax credit claimed on your federal income tax return
- Keep detailed invoices and manufacturer certification statements for your records
- The credit reduces your tax liability dollar-for-dollar (up to the $3200 cap)
- Claim the credit using IRS Form 5695 when filing taxes for the year of installation
The Section 25C tax credit program ends on December 31st, 2025. Projects must be installed and placed in service before this date to qualify. Consult your tax professional for more information on how this credit may apply to your individual situation.
