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 also free up valuable space as they’re much smaller than traditional heating and cooling systems.
What’s even better, right now the Inflation Reduction Act offers a rebate of up to $8,000, making new installation even more affordable. What are you waiting for? Call the pros at AW Heating & Air Conditioning to schedule your heat pump installation in Lincoln.
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 efficient, eco-friendly home improvements more affordable.
You can earn these rebates and tax credits when you purchase energy-efficient upgrades including heat pumps. There has never been a better time to go green!
How Will the Inflation Reduction Act Impact Me?
The Inflation Reduction Act affects you and other homeowners by making heat pumps and other energy-efficient home upgrades more affordable. It does that in the form of rebates and tax credits.
When considering the Inflation Reduction Act heat pump rebates and tax credits, you have two options for lowering costs. The program you choose 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 in the Inflation Reduction Act is for low-income and moderate-income homeowners. Your rebate can cover the entire cost of heat pump installation for low-income homeowners and up to 50% percent for moderate-income homeowners.
The rebate can't exceed $8,000 for both low-income and moderate-income homeowners. It is a point-of-sale rebate, which means you deduct the rebate from the initial purchase price of the heat pump.
The income criteria are:
- Low Income: Less than 80% of the area median income
- Moderate Income: 80-150% of the area median income
Uncertain which income category you fall into or what the median income is where you live? The nonprofit group Rewiring America has an online calculator you can use to find out. Just provide your ZIP Code and household income.
What Is the Inflation Reduction Act Heat Pump Tax Credit
For homeowners with incomes that exceed what qualifies for a heat pump rebate, there is an Inflation Reduction Act heat pump tax credit. Redeemable for up to 30 percent of the purchase or installation of a heat pump, the heat pump tax credit is worth no more than $2,000.
Different from the rebate, which is available at the time of purchase, the tax credit is received once you have filed your taxes.* Hold onto the 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
Which Models of Heat Pumps Qualify for the Inflation Reduction Act
The Inflation Reduction Act heat pump tax credits and rebates can only be used for the purchase and installation of energy-efficient heat pump models.
At minimum, a heat pump must demonstrate ENERGY STAR® certification to be eligible for a rebate or tax credit. Ask for more information from our team at AW Heating & Air Conditioning.
How Do I Get the Inflation Reduction Act Rebate
If you are an eligible homeowner, the heat pump rebate in the Inflation Reduction Act can be earned after purchasing the heat pump. You get it promptly since it's deducted from the price of purchase and installation of the heat pump. You aren't required to send in a proof of purchase or wait for a rebate to come later.
The Inflation Reduction Act heat pump tax credit, alternatively, is something you redeem on your taxes.* It decreases the total amount of money owed to the government when you file your taxes.
*Consult with a tax professional for full details on how to apply
Reach Out to the Pros at AW Heating & Air Conditioning for More Information About the Inflation Reduction Act Heat Pump Rebate and Tax Credit
Thanks to a high-efficiency heat pump, you can save money and do your part for the environment using tax credits and rebates from the Inflation Reduction Act. AW Heating & Air Conditioning can help with the specifics on these discount programs so you get maximum savings! Our certified team is ready to help make your next heat pump installation Lincoln a smooth and easy experience.