It seems that there is some confusion in the market about whether a heat pump tax credit will be available in 2025. Much of the confusion comes from the new A2L refrigerant. While the EPA’s refrigerant mandate requiring the use of R-454B or R-32 A2L refrigerant takes effect on January 1, 2025, the new requirements will be rolled out slowly.
If you are considering a new heat pump or heat pump replacement, here are some things you need to know.
Myth: To qualify for tax credits for heat pumps, the refrigerant needs to be 454 or R32 (the new A2L refrigerant).
Truth: As of January 1, 2025, air source heat pumps that are recognized as ENERGY STAR Most Efficient are eligible for this credit. There are two pathways for eligibility. One pathway is designed for heating-dominated applications (i.e., cold climates), and the relevant eligible products will be designated as ENERGY STAR Cold Climate.
The other path is for cooling-dominated dual-fuel applications (e.g., a heat pump paired with a furnace). Consumers and contractors can choose either pathway regardless of the home’s location, as there is no longer a regional requirement.
Energy Star Certified
ENERGY STAR® is the government-backed symbol for energy efficiency. The blue ENERGY STAR label provides simple, credible, and unbiased information that consumers and businesses rely on to make well-informed decisions.
ENERGY STAR offers a list of Tax Credit Eligible ENERGY STAR Certified Air-Source Heat Pumps (both central heat pumps and ductless heat pumps) designed for contractors to help you choose the product that will meet the requirements to claim the tax credit when you file your 2025 taxes.
For homeowners, these credits represent a significant opportunity to invest in long-term energy savings while improving the comfort of their homes and reducing their tax burden. By understanding the new requirements, you can make informed decisions that make sense for your wallet and your home.
Federal Tax Credits for Energy Efficiency
The Inflation Reduction Act of 2022 empowers Americans to make homes and buildings more energy-efficient by providing federal tax credits and deductions that will help reduce energy costs and demand as we transition to cleaner energy sources.
ENERGY STAR has information to help you plan energy-efficient upgrades to your home. These upgrades can save energy and money on your energy bills and qualify you for a tax credit on next year’s tax bill. As always, staying informed and planning are key to taking full advantage of these incentives.
Homeowners Can Save Up to $3,200 Annually on Taxes for Energy Efficient Upgrades
Federal income tax credits are available to homeowners through 2032. These credits will allow up to $3,200 annually to lower the cost of energy-efficient home upgrades by up to 30 percent.
Endless Energy Can Help You Navigate Heat Pump Tax Credits and Rebates
Upgrading to an energy-efficient heat pump is one of the smartest investments you can make for your home. Whether you’re considering a heat pump installation for the first time, looking into a heat pump replacement, or exploring options like a mini split heat pump or an air conditioner heat pump, understanding the available incentives is key to maximizing your savings.
With over 40 years of experience, Endless Energy is here to help you choose the right heat pump for your home while ensuring you take full advantage of available tax credits and rebates. Our team can guide you through the selection process, ensuring you invest in an ENERGY STAR-certified heat pump that meets eligibility requirements for the 2025 federal tax credit.
Don’t leave savings on the table—contact Endless Energy today to learn more about rebates for heat pumps and how you can upgrade your home’s comfort and efficiency with confidence!
