“…in this world, nothing is certain except death and taxes,” wrote Benjamin Franklin, and his words hold still today. No matter how much we may dread it, taxes are due every year.
You may be able to get a little break, however. For customers who choose to upgrade their home’s heating and cooling with a new energy-efficient Carrier heat pump from Pruett Air Conditioning, a substantial heat pump tax credit may be available to help reduce your future tax bills.
(Plus, with a high-efficiency heat pump, you’ll see lower energy bills every month – win-win!)
In this article, we’ll look into the Energy Efficient Home Improvement Credit and how a new heat pump can save you money in more ways than one.
What Is the Heat Pump Tax Credit?
The heat pump tax credit is part of the Energy Efficient Home Improvement Credit (EEHIC) created in the Inflation Reduction Act. The EEHIC is designed to reward customers for upgrading their home’s overall energy efficiency.
Homeowners who install a new energy-efficient heat pump can earn a tax credit for 30% of the purchase and installation cost, up to a total credit of no more than $2,000.
While this article will focus on the benefits offered to those purchasing a new heat pump for their home, the EEHIC also includes tax credits for installing:
- Alternative energy sources, such as solar or fuel cells or wind turbines
- High-efficiency appliances, such as water heaters and biomass stoves
- Passive efficiency improvements, such as insulated windows and doors
- Home efficiency audits
Who Is Eligible for the Heat Pump Tax Credit?
While there are some caveats for people who use their home partially for business purposes, in general, the heat pump tax credit is available to:
- Homeowners and certain renters whose primary residence is in the United States, and,
- Who are purchasing qualified appliances or other home improvements for that primary residence.
The credit is not available for new construction; it is only for existing homes being upgraded or added onto.
What Kinds of Systems Are Eligible For the Heat Pump Tax Credit?
Homeowners purchasing just about any type of air-source heat pump can qualify for the credit. The heat pump tax credit is available for central, ducted heat pumps and mini-split heat pumps. The efficiency requirements differ for each type, but eligible pumps of both form factors are readily available.
If you’re wondering whether a mini-split is the right choice, check out our recent article, “What is a Mini-Split and Will It Work For My Home?”
Geothermal heat pumps are eligible for a different tax credit, the Residential Clean Energy Credit, which covers 30% of a system’s installed cost without the $2,000 maximum imposed by the EEHIC.
How Do I Find an Eligible Heat Pump?
Generally speaking, all heat pumps that have received the Energy Star certification from the Environmental Protection Agency are qualified for the heat pump tax credit. This certification is based primarily on a unit’s SEER rating, which measures the system’s overall efficiency.
To maximize your savings over the entire life of your heat pump, you should always shop for the highest SEER rating that your budget allows. A higher SEER rating means the system will use less electricity to provide the same level of cooling/heating as a unit with a lower SEER.
For example, if you’re replacing an old unit (SEER rating of 10) with a new Energy Star unit (SEER rating of 18), your annual energy savings could be about $210!
Pruett Air Conditioning is proud to offer the full line of Carrier high-efficiency heat pumps, with Energy Star-certified units available in both the Performance and Infinity product lines.
How Do I Get the Heat Pump Tax Credit?
Filing for the heat pump tax credit is simple. The main thing to remember is that you will need to keep your receipts, invoices, and any other documentation of your purchase. When you file your taxes for the year your new heat pump is installed, you must also complete and submit IRS Form 5695.
Hot? Cold? Call the Man! Pruett Air Conditioning Proudly Offers Carrier’s Full Line of High-Efficiency Heat Pumps.
Whether you’re replacing an old unit that’s starting to fail or just trying to reduce your monthly energy bills, our technicians are ready to install your new efficient Carrier heat pump! Call today:
Pruett Air Conditioning has offices in Warner Robins and Eastman, GA, so no matter where in Middle Georgia you’re located, Pruett is your local HVAC company.
- Bonaire, GA
- Byron, GA
- Centerville, GA
- Cochran, GA
- Dublin, GA
- Eastman, GA
- Fort Valley, GA
- Kathleen, GA
- Macon, GA
- McRae, GA
- Perry, GA
- Warner Robins, GA