Heat pumps have been hailed as one of the most energy-efficient solutions for year-round comfort in your home. Not only do they save you money on electricity bills, but they can help minimize strain on any other heating and cooling systems.
Additionally, right now the Inflation Reduction Act provides rebates of a maximum of $8,000, making new installation even more affordable. What are you waiting for? Contact the experts at 1st Choice Heating & Air Conditioning, Inc. to arrange heat pump installation in Lake Forest.
What Is the Inflation Reduction Act
The Inflation Reduction Act of 2022 was created to reduce the impact of inflation on the country. An increasingly popular strategy is funding green technology and making sustainable HVAC systems more affordable.
Homeowners can benefit from major rebates and tax credits when they purchase energy-efficient equipment such as heat pumps. Now's the perfect time to go green!
How Will the Inflation Reduction Act Impact Me?
The Inflation Reduction Act helps lower residential energy costs by making heat pumps and other energy-efficient home upgrades more affordable. It does that in the form of rebates and tax credits.
When it comes to the Inflation Reduction Act heat pump rebates and tax credits, you have two main options for saving money. Which program you use is dependent on your income.
The two programs available are:
- Inflation Reduction Act heat pump rebate
- Inflation Reduction Act heat pump tax credit
What Is the Inflation Reduction Act Heat Pump Rebate
The heat pump rebate available from the Inflation Reduction Act is for low-income and moderate-income homeowners. The rebate covers 100 percent of the cost of heat pump installation for low-income homeowners and up to 50% percent for moderate-income homeowners.
The rebate is capped at $8,000 for both low-income and moderate-income homeowners. It is a point-of-sale rebate, which means it is deducted from the purchase price when you buy the heat pump.
The income conditions are:
- Low Income: Less than 80% of the area median income
- Moderate Income: 80-150% of the area median income
Not sure which income category applies to you or what the typical income for your community is? The nonprofit group Rewiring America created an online calculator so you can find out. You only need to provide your ZIP Code and household income.
What Is the Inflation Reduction Act Heat Pump Tax Credit
For homeowners whose income is too high to qualify for a heat pump rebate, there is an Inflation Reduction Act heat pump tax credit. With the option to recoup up to 30 percent after the purchase or installation of a heat pump, the heat pump tax credit is worth a maximum of $2,000.
Different from the rebate, which is accessible right at the time of purchase, the tax credit is applied as you file your taxes.* Don't lose your receipt, because the credit can be claimed the same year the heat pump was purchased.
*Consult with a tax professional for full details on how to apply
What Heat Pumps Qualify for the Inflation Reduction Act
The Inflation Reduction Act heat pump tax credits and rebates only apply to the purchase and installation of energy-efficient heat pump models.
At minimum, a heat pump needs to have ENERGY STAR® certification for the rebate or tax credit to apply. Additional details are available from our team at 1st Choice Heating & Air Conditioning, Inc..
How Do I Get the Inflation Reduction Act Rebate
For homeowners who qualify, the heat pump rebate in the Inflation Reduction Act can be earned after purchasing the heat pump. You get it straightaway as it is subtracted from the price of purchase and installation of the heat pump. There’s no need to send in a proof of purchase or wait for a rebate to come later.
The Inflation Reduction Act heat pump tax credit, conversely, must be received after you file taxes.* It lowers the total amount of money you owe to the IRS after you've finished filing taxes.
*Consult with a tax professional for full details on how to apply
Call Your Local Pros at 1st Choice Heating & Air Conditioning, Inc. for Details About the Inflation Reduction Act Heat Pump Rebate and Tax Credit
With the energy efficiency of a brand-new heat pump, you can save money and protect the environment thanks to tax credits and rebates from the Inflation Reduction Act. 1st Choice Heating & Air Conditioning, Inc. can help with the specifics on these discount programs so you receive the greatest savings possible! We're ready and able to help make your next heat pump installation Lake Forest a smooth and easy experience.