Heat pumps have been hailed as one of the most energy-efficient solutions for keeping your home comfortable all year-round. Not only do they reduce your electricity costs, but they're also more compact and easier to install than conventional heating and cooling systems.
In addition, right now the Inflation Reduction Act offers a rebate of up to $8,000, lowering costs for new installation even further. So why wait? Get in touch with the comfort specialists at Herman Allen Plumbing, Heating & Cooling to arrange heat pump installation in Greater Richmond.
What Is the Inflation Reduction Act
The Inflation Reduction Act of 2022 was written in hopes of reducing the effects 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 equipment such as heat pumps. There has never been a better time to go green!
How Will the Inflation Reduction Act Affect Me
The Inflation Reduction Act keeps utility costs lower by making heat pumps and other energy-efficient home upgrades more affordable. It does that in the form of rebates and tax credits.
Regarding the Inflation Reduction Act heat pump rebates and tax credits, you have two options for lowering costs. 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. 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 has a maximum of $8,000 for both low-income and moderate-income homeowners. It is a point-of-sale rebate, which means you subtract the rebate from the initial cost of a new 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
Unsure which income category you're in or what the average income is in your area? The nonprofit group Rewiring America created an online calculator so you can 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. 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.
Distinct from the rebate, which is available at the time of purchase, the tax credit is claimed when you do 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
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 must demonstrate ENERGY STAR® certification for eligibility for the rebate or tax credit. You can get all the details from our team at Herman Allen Plumbing, Heating & Cooling.
How Do I Get the Inflation Reduction Act Rebate
For qualifying homeowners, 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 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, conversely, is something you redeem on your taxes.* It reduces the total amount of money you owe the government after you've finished filing taxes.
*Consult with a tax professional for full details on how to apply
Contact the Comfort Pros at Herman Allen Plumbing, Heating & Cooling 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 do your part for the environment courtesy of tax credits and rebates from the Inflation Reduction Act. Herman Allen Plumbing, Heating & Cooling can help with the specifics on these discount programs so you can enjoy more savings! Our certified team is ready to help make your next heat pump installation Greater Richmond a seamless experience.