Federal Tax Credits
The Inflation Reduction Act
The Inflation Reduction Act of 2022 included tax credits that rewarded homeowners for purchasing certain high-efficiency HVAC equipment through December 31, 2025.
What is the Inflation Reduction Act?
To help reduce the effects of inflation, the U.S. Government passed the Inflation Reduction Act of 2022. Of particular interest to homeowners, this act included a number of tax credits for the installation of ENERGY STAR® certified home heating and cooling products purchased through December 31, 2025. These included:
Tax Section 25C, Nonbusiness Energy Property Credit
Effective Jan 1, 2023 through December 31, 2025: Provides a tax credit to homeowners equal to 30% of installation costs for the highest efficiency tier products, up to a maximum of $600 for qualified air conditioners and furnaces, and a maximum of $2,000 for qualified heat pumps.
Tax Section 25D, Residential Energy Efficient Property
Provides a tax credit to homeowners equal to 30% of installation costs for ENERGY STAR® tier products purchased through December 31, 2025.