Jan 30 , 2025 Comment

The Inflation Reduction Act (IRA) has brought significant opportunities for homeowners to upgrade their HVAC systems while benefiting from rebates and tax incentives. As we approach 2025, understanding the changes and opportunities for savings can help you make informed decisions about your home’s energy efficiency. Here’s what you need to know about maximizing HVAC rebates under the IRA and choosing the right system for your needs.

*Note: The future of HVAC tax credits is uncertain, but eligible rebates are still available for now. The new administration has signaled intentions to reassess and potentially roll back certain clean energy funding and tax credits.

Maximum IRA Rebates for HVAC Systems

  • Qualifying Gas Package Units: Receive up to 30% of the cost, with a maximum rebate of $600.
  • Qualifying Split Systems: Get up to 30% of the cost, capped at $1,200. This includes $600 for the air conditioner and $600 for the furnace
  • Qualifying Heat Pumps: Benefit from up to 30% of the cost, with a maximum rebate of $2,000.

Combining Heat Pump Rebates with Other HVAC Rebates

You can maximize savings if you replace multiple systems in your home:

  • Heat Pump and Gas Package Unit: Receive a combined rebate of up to $1,800.
  • Heat Pump and Split System: Get the highest possible combined rebate of $3,200 under the IRA.

Key 2025 Changes in HVAC Credit Qualifications

Starting in 2025, HVAC systems must meet ENERGY STAR Most Efficient certification requirements to qualify for the Energy Efficient Home Improvement Credit (§ 25C).

2024 vs. 2025 Requirements

  • 2024: Systems with a high Seasonal Energy Efficiency Ratio (SEER) were eligible.
  • 2025: Only systems with ENERGY STAR Most Efficient certification will qualify, emphasizing stricter EPA standards for energy efficiency and performance.

ENERGY STAR vs. Non-Certified Systems

  • ENERGY STAR Most Efficient Certification: Ensures systems meet the highest EPA standards for efficiency, performance, and reliability. These systems are considered the best in class and are eligible for IRA rebates. While they often come with a higher price tag, the rebates can help offset the costs.
  • Non-Certified Options: High-quality systems without the ENERGY STAR Most Efficient certification can be a more budget-friendly option. They typically cost less upfront, and in many cases, even after factoring in IRA rebates, they may still save you money compared to certified systems.

 

How We Can Help

At Klimatology HVAC, we are committed to helping you make the best choice for your home:

  • Rebate-Eligible Quotes: We can provide quotes for systems that qualify for IRA rebates, helping you maximize your savings.
  • Comparison Options: Our team will present multiple system options, including certified and non-certified systems, so you can compare costs and choose the one that fits your budget and energy efficiency goals.
  • Tax Professional Recommendation: To ensure you qualify for the Energy Efficient Home Improvement Credit and make the most of available incentives, we recommend consulting with a tax professional.

Useful Links

To download manufacturer certificates for 2024 visit Trane and Goodman websites.

Submit Form 5695 with your tax returns to the IRS. Learn how to properly submit here.

To check if your system is eligible for a tax rebate, use the Department of Energy tool here.

 

Important Note: We strongly recommend consulting with a tax professional for guidance on claiming the Energy Efficient Home Improvement Credit and completing the necessary forms. While we provide links to the manufacturer’s website and the IRS for rebate applications and documentation, we cannot offer advice on how to fill out the forms or navigate the tax credit process.

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