Heat pumps have been hailed as one of the most energy-efficient solutions for keeping your home cool in summer and warm in winter. 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 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 Brookwood Inc to schedule your heat pump installation in Newton.
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. One of the ways it does that is by funding green technology and making sustainable HVAC systems more affordable.
You can earn both rebates and tax credits after purchasing energy-efficient equipment such as heat pumps. There has never been a better time to go green!
How Will the Inflation Reduction Act Impact Me?
The Inflation Reduction Act helps lower residential energy costs by making heat pumps and other energy-efficient home upgrades more affordable. It does this through a combination 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 in the Inflation Reduction Act is for low-income and moderate-income homeowners. A rebate covers the entirety of heat pump installation for low-income homeowners and up to 50% percent for moderate-income homeowners.
The rebate is capped at $8,000 for both low-income and moderate-income homeowners. It is a point-of-sale rebate, which means it is deducted from the purchase price when you buy 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
Unsure which income category applies to you or what the typical income for your community is? 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. Along with the ability to redeem the credit for up to 30 percent of the purchase or installation of a heat pump, the heat pump tax credit is worth a maximum of $2,000.
Different from the rebate, which is used immediately during your initial 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 have ENERGY STAR® certification for the rebate or tax credit to apply. Ask for more information from our team at Brookwood Inc.
How Do I Get the Inflation Reduction Act Rebate
If you are an eligible homeowner, the heat pump rebate in the Inflation Reduction Act is available when you purchase the heat pump. You get it promptly as it is subtracted 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 lowers the total amount of money you owe the government once you file taxes.
*Consult with a tax professional for full details on how to apply
Contact the Comfort Pros at Brookwood Inc 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 protect the environment thanks to tax credits and rebates from the Inflation Reduction Act. Brookwood Inc is happy to help you navigate the details on these discount programs so you can enjoy more savings! Our certified team is ready to help make your next heat pump installation Newton a stress-free experience.