Heat pumps have been hailed as one of the most energy-efficient solutions for keeping your home cool in summer and warm in winter. 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, lowering costs for new installation even further. So don't wait! Contact the experts at ACE Solutions to schedule your heat pump installation in Hasbrouck Heights.
What Is the Inflation Reduction Act
The Inflation Reduction Act of 2022 was created to reduce the impact 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 these rebates and tax credits when you purchase energy-efficient equipment such as heat pumps. There has never been a better time to go green!
How Will the Inflation Reduction Act Influence My Energy Costs
The Inflation Reduction Act affects you and other homeowners by making heat pumps and other energy-efficient home upgrades more affordable. It does that in the form of rebates and tax credits.
When considering the Inflation Reduction Act heat pump rebates and tax credits, you have two options for lowering costs. 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 available from the Inflation Reduction Act is for low-income and moderate-income homeowners. A rebate covers the entirety 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 it is deducted from the purchase price when you buy the heat pump.
The income conditions 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. You only need to provide your ZIP Code and household income.
What Is the Inflation Reduction Act Heat Pump Tax Credit
For homeowners with incomes that exceed what qualifies 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.
Distinct from the rebate, which is accessible right at the time of purchase, the tax credit is claimed when you do your taxes.* Don't lose your 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 Models of Heat Pumps Qualify for the Inflation Reduction Act
The Inflation Reduction Act heat pump tax credits and rebates only apply to the purchase and installation of energy-efficient heat pump models.
At minimum, a heat pump must demonstrate ENERGY STAR® certification for eligibility for the rebate or tax credit. Additional details are available from our team at ACE Solutions.
How Do I Get the Inflation Reduction Act Rebate
If you are an eligible homeowner, the heat pump rebate in the Inflation Reduction Act can be earned after purchasing the heat pump. You get it right away since it's deducted 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 the government once you file taxes.
*Consult with a tax professional for full details on how to apply
Call Your Local Pros at ACE Solutions to Learn More About the Inflation Reduction Act Heat Pump Rebate and Tax Credit
Thanks to 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. ACE Solutions is happy to help you navigate the details on these discount programs so you get maximum savings! We're ready to help make your next heat pump installation Hasbrouck Heights a seamless experience.