Heat pumps are considered some of the most energy-efficient solutions for keeping your home cool in summer and warm in winter. Not only do they help lower your monthly electricity bill, but they're also more compact and easier to install than conventional heating and cooling systems.
What's more, right now the Inflation Reduction Act can offer you a rebate of no more than $8,000, making new installation even more affordable. So why wait? Get in touch with the comfort specialists at James Heating & A/C, Inc to request heat pump installation in Lexington.
What Is the Inflation Reduction Act
The Inflation Reduction Act of 2022 intends to reduce inflation's impact on the country. An increasingly popular strategy is funding green technology and making efficient, eco-friendly home improvements more affordable.
Homeowners can benefit from major rebates and tax credits when they purchase energy-efficient upgrades including heat pumps. Now's the perfect 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 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 in 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 has a maximum of $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 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 you're in or what the average income is in your area? 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 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.
Distinct from the rebate, which is available at the time of purchase, the tax credit is applied as you file 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 are only accessible after the purchase and installation of energy-efficient heat pump models.
At the very least, a heat pump needs to have ENERGY STAR® certification for eligibility for the rebate or tax credit. Ask for more information from our team at James Heating & A/C, 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 right when you purchase the heat pump. You get it straightaway since it's deducted from the price of purchase and installation of the heat pump. You don't have to send in a proof of purchase or wait for a rebate to come later.
The Inflation Reduction Act heat pump tax credit, alternatively, must be redeemed on your taxes.* It lowers the total amount of money you owe to the IRS once you file taxes.
*Consult with a tax professional for full details on how to apply
Contact the Comfort Pros at James Heating & A/C, Inc for Details About the Inflation Reduction Act Heat Pump Rebate and Tax Credit
With a high-efficiency heat pump, you can save money and protect the environment courtesy of tax credits and rebates from the Inflation Reduction Act. James Heating & A/C, Inc is happy to help you navigate the details on these discount programs so you receive the greatest savings possible! Our certified team is ready to help make your next heat pump installation Lexington a stress-free experience.