Heat pumps are some of the most energy-efficient solutions for year-round comfort in your home. 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 provides rebates of a maximum of $8,000, making new installation even more affordable. So don't wait! Call the pros at Northern Comfort Inc to arrange heat pump installation in Mankato area.
What Is the Inflation Reduction Act
The Inflation Reduction Act of 2022 was created to reduce the impact of inflation on the country. One of the ways it does that is by funding green technology and making high-efficiency utility equipment and appliances more affordable.
Homeowners can benefit from major rebates and tax credits when they purchase energy-efficient upgrades including heat pumps. Now is a great opportunity 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 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. 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 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
Uncertain 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. All you need is your ZIP Code and household income.
What Is the Inflation Reduction Act Heat Pump Tax Credit
For homeowners that make too much to be eligible for the 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 a maximum of $2,000.
Unlike 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 Heat Pumps Are Eligible 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 minimum, a heat pump must have ENERGY STAR® certification for the rebate or tax credit to apply. Additional details are available from our team at Northern Comfort Inc.
How Do I Get the Inflation Reduction Act Rebate
For qualifying homeowners, the heat pump rebate in the Inflation Reduction Act is available when you purchase the heat pump. You get it straightaway as it is subtracted from the price of purchase and installation of the heat pump. There’s no need 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 lowers 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
Contact the Comfort Pros at Northern Comfort Inc for More Information 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 using tax credits and rebates from the Inflation Reduction Act. Northern Comfort Inc 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 Mankato area a seamless experience.