Heat pumps have been hailed as one of the most energy-efficient solutions for keeping your home comfortable all year-round. Not only do they save you money on electricity bills, but they also free up valuable space as they’re much smaller than traditional heating and cooling systems.
What's more, right now the Inflation Reduction Act provides rebates of a maximum of $8,000, making it even more affordable than ever. So why wait? Call the pros at J.L. Brady Company LLC to schedule your heat pump installation in Moline.
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. An increasingly popular strategy is funding green technology and making high-efficiency utility equipment and appliances more affordable.
You can earn both rebates and tax credits after purchasing energy-efficient upgrades including heat pumps. There has never been a better time to go green!
How Will the Inflation Reduction Act Affect 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.
When considering the Inflation Reduction Act heat pump rebates and tax credits, you have two main options for saving money. The ideal option depends 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. The rebate covers 100 percent of the cost 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 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
Not sure which income category you fall into or what the median income is where you live? The nonprofit group Rewiring America created an online calculator so you can find out. All you need is your ZIP Code and household income.
What Is the Inflation Reduction Act Heat Pump Tax Credit
For homeowners whose income is too high to qualify 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 accessible right 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 can only be used for the purchase and installation of energy-efficient heat pump models.
At minimum, a heat pump must demonstrate ENERGY STAR® certification for the rebate or tax credit to apply. Additional details are available from our team at J.L. Brady Company LLC.
How Do I Get the Inflation Reduction Act Rebate
For homeowners who qualify, the heat pump rebate in the Inflation Reduction Act can be earned after purchasing the heat pump. You get it straightaway 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, conversely, is something you redeem on your taxes.* It lowers the total amount of money you owe to the IRS once you file taxes.
*Consult with a tax professional for full details on how to apply
Contact the Comfort Pros at J.L. Brady Company LLC to Learn More About the Inflation Reduction Act Heat Pump Rebate and Tax Credit
With a high-efficiency heat pump, you can save money and do your part for the environment courtesy of tax credits and rebates from the Inflation Reduction Act. J.L. Brady Company LLC 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 Moline a seamless experience.