If you have clients looking to install new heat pumps in 2023, be sure to inform them of tax credits that may be available to them through the Federal government. Mostly, these credits are an extension of those available in previous years — but many homeowners are unaware of them. Sharing this information with your client could make the difference between them purchasing a new heat pump through your HVAC business and waiting it out another year.

So, what do HVAC professionals need to know about heat pumps and tax incentives?

More About Tax Credits for Heat Pumps

Tax credits for specific energy-efficient heat pumps are available through the Inflation Reduction Act of 2022. This act offers Federal tax credits for heat pump models that are rated at the highest tier of efficiency according to the Consortium for Energy Efficiency.

This incentive comes in the form of a tax credit, so consumers who purchased an eligible heat pump during the given tax year can receive money back when they file their taxes or use the credit to offset taxes owed. The heat pump credit is specifically good for up to 30% of the total cost of the heat pump itself. This includes not just parts but installation and labor as well. The credit maxes out at $2,000 and, according to the Inflation Reduction Act, will be available to consumers through the end of 2032.

It is worth noting that eligibility for credits can vary based on the taxpayer’s income. For example, those with household incomes totaling more than 150% of the state’s median income are not eligible. However, anybody with household income less than 150% of their respective state’s median income is eligible for anywhere from 50% to 100% of the tax credits available.

Benefits of Tax Incentives for Efficient Heat Pumps

Overall, the purpose of offering tax credits and incentives to consumers buying high-efficiency heat pumps is to make them more accessible to a wider segment of buyers. With the average cost to install a new heat pump hovering around $5,500, it’s easy to see why affording a new heat pump can be challenging.

At the same time, the Department of Energy is working hard to reduce carbon emissions and boost overall energy efficiency throughout households in the United States. As it stands, residential heating and cooling are a major source of carbon emissions, accounting for 20% of all carbon emissions nationwide and producing roughly 441 million tons of carbon dioxide each year.

With this in mind, it makes sense that the Federal government needs to take steps to help consumers afford more energy-efficient HVAC equipment. These credits will make it more attainable for homeowners to install new heat pumps regardless of their income or economic status. 

Combine all this with the fact that newer, more efficient heat pump models can also save consumers money on their own energy bills. When monthly energy savings are combined with tax credits, the cost of installing a new heat pump can be offset over time. Ultimately, we’ll all reap the benefits of reduced carbon emissions and a healthier planet for generations to come.

Explore Heat Pump Options From CE

As you can see, there are some great tax credit options available to your residential clients who may be looking to purchase a new heat pump this year. If you have clients who have been on the fence, now is a great time to share this information with them so that they can make an informed decision about their household heating and cooling needs.

If you’re looking for an excellent heat pump to recommend to your clients, CE has you covered. We carry a wide range of heat pump systems, including energy-efficient condensing units with a SEER rating of up to 20. This includes our popular Carrier® Infinity™ variable speed heat pump model and our Bryant® Evolution® 3-ton variable speed model. If you have customers who don’t have existing ductwork systems installed in their homes, we even carry ductless heat pump options with up to 20 SEER.

All of these units offer the latest energy-saving technology while reducing carbon emissions, so your customers can feel good about their purchases while potentially being eligible for tax credits. As an HVAC professional, you’ll also find everything you need for an easy and proper installation at CE. From ductless controls and pad mounts/blocks to disconnects and everything in between, CE is the best place for the highest quality parts and equipment.

The Bottom Line on Heat Pumps and Tax Incentives

Now more than ever, we have an obligation to reduce carbon emissions and leave the planet a better and more sustainable place for future generations. High-efficiency residential heat pumps are a great way to do just that — and tax credits available through the Inflation Reduction Act make installing these heat pumps more attainable for hardworking Americans across the board.

The next time you have a client who is thinking about buying a new heat pump unit, be sure to share this information with them so they can make an informed decision. In the meantime, keep an eye on the CE News blog for the latest industry news and updates!

By Katie Conigliaro

www.carrierenterprise.com/hvac-new