You may have heard that the Inflation Reduction Act (IRA) of 2022 offers money back to taxpayers when they install energy-saving HVAC equipment.
Is it true? Yes. Federal tax credits are available now. But even more savings may be available to you once Washington State rolls out its rebate program.
Here’s what we know so far.
You Can Get A Tax Credit From The IRS
According to the White House website dedicated to explaining the Inflation Reduction Act, specifically the portion of the act that helps homeowners buy efficient HVAC equipment, households can “claim a tax credit for 30% of the costs of buying and installing a heat pump, up to $2,000.” This tax credit includes support for electric system upgrades that make it possible to install a heat pump.
The bottom line: If you get a heat pump for your home in 2024, you can claim up to $2,000 off the cost when you file your 2024 taxes.
You can also get these tax credits from the IRS:
- Efficient air conditioning and heating systems are eligible for 30% off the cost, up to $600. Same for efficient water heating equipment.
- An electric panel or circuit upgrades for new electric equipment are eligible for 30% off the cost, up to $600.
There Are No Additional Rebates On HVAC Equipment In Washington State…Yet
Washington State Department of Commerce says that the state’s IRA-funded rebate programs “are expected to be available to consumers later in 2024 or 2025.”
As of May 2024, we’re expecting IRA funds for our state’s rebate programs to come through sometime this year.
Once they do, Commerce will develop a high-efficiency electric home rebate program. It will provide income-eligible consumers with instant rebates on highly efficient electric equipment and electrification projects for their homes.
Once this program is in place, many Washington customers will be able to replace their home HVAC equipment with more efficient systems with the help of both a federal tax credit and Washington State rebates.
We’ll keep you updated as we learn more.
How Do I Decide When To Buy A New System?
If you have questions about how the IRA tax credits and future rebates will affect you and need help deciding what time will be the best time to move ahead with your HVAC, plumbing, or electrical project, get in touch by texting or calling us.
We’d be glad to discuss your options so you have as much information as possible.