Click Here for the Federal Guidelines

 

Heat Pumps: The credit applies to both air source and geothermal heat pumps. These systems must meet specific energy efficiency criteria set by the Department of Energy

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Primary Residence The installation must occur at the homeowner's primary residence. Rentals and second homes do not qualify for this credit.

 

Credit Details: Credit Amount: Homeowners can claim a credit of 30% of the cost of purchasing and installing eligible heat pumps.

 

Maximum Limit: There is a cap of $2,000 per year for the total credit amount, which applies to all combined qualifying improvements, not just the heat pump installation.-

 

Annual Reset: The credit limit resets each year, allowing homeowners to claim it annually for different qualifying improvements.

 

Availability: This credit is available from January 1, 2023, through December 31, 2032. This extension under the IRA provides a long-term incentive for homeowners to invest in energy efficiency

 

Claim Process: Homeowners can claim the credit on their federal income tax return for the year the installation was completed. To do so, they must keep receipts and certifications from manufacturers stating that the product qualifies for the credit.

 

By reducing the upfront cost of installing energy-efficient heat pumps, this credit not only makes it more financially feasible for individuals to upgrade their home systems but also supports broader environmental goals by promoting the use of cleaner, more sustainable energy sources.