Inflation Reduction Act Tax Credits & Rebates

What the Inflation Reduction Act (IRA) Means for You – Tax Credits and Rebates

Is it time for you to upgrade your home’s HVAC system, water heater, and electrical box? You can get huge savings on new equipment and installation costs through tax credits and rebates provided by the Inflation Reduction Act.


How Much Can I Save with Tax Credits?

25C Tax Credit (Covers 30% of Cost)
For Qualified Electrification Upgrades
Total Annual Credit$3,200
Heat Pump$2,000
Other Upgrades$1,200
Annual Credit For Heat Pumps and Heat Pump Water Heater$2,000
Heat Pump$2,000
Annual Credit for Other Upgrades$1,200
Air Conditioner$600
Electrical Panel$600
Energy Audit$150

The Inflation Reduction Act (IRA) was signed into law to benefit homeowners who make energy-efficient home upgrades. The act includes over $369 billion in the form of tax credits and rebates and allows homeowners who purchase heat pumps or other energy-efficient home appliances to save more than $14,000 in consumer rebates and tax incentives. These energy-efficient upgrades can also save homeowners more than $600 annually on their energy bills. While rebates will not be available until the end of 2023, tax credits are available now to all customers.

Contact Best Home Services today to learn how to save money this year through rebates and tax incentives.

25C Energy Efficient Home Improvement Tax Credit

The Inflation Reduction Act includes tax credits for households making energy-efficient choices. The Energy Efficient Home Improvement Tax Credit included in the IRA is an expansion of the existing 25C tax credit. It allows homeowners to deduct up to 30% of the total cost of certain home improvements, up to $3200 annually. Important: To be eligible for the tax credit, any upgrades you make must meet applicable Consortium For Energy Efficiency and Energy Star requirements.

The home service professionals at Best Home Services can provide expert help and guidance when you are ready for energy-efficient upgrades. Contact us online to schedule an analysis of your home’s energy usage.

All homeowners are eligible for the 25C tax credit. There are no income qualifications for tax credits. Anyone with adequate tax liability to offset can qualify.

Yes. 25C upgrades must meet the Consortium for Energy Efficiency’s highest non-advanced tier and Energy Star requirements. The home service professionals at Best Home Services can help you select the right upgrades to qualify for the 25C tax credit.

Our team at Best Home Services will take the headache and hard work away and provide you with all the proper documentation to easily claim your home upgrade tax credits when you file your taxes. However, please note that we are not tax professionals and cannot provide tax filing or other financial advice.

Let Best Home Services help you get the most out of your tax credits. Contact us today for assistance.

IRA Rebates Are Coming Soon!

High-Efficiency Electric Home Rebate (HEEHRA)

The High-Efficiency Electric Home Rebate program provides point-of-sale discounts to low- and middle-income homeowners, allowing them to save up to $14,000 on energy-efficient home upgrades. The program covers 100% of electrification costs for low-income households and 50% of costs for moderate-income households, including the cost of the equipment and labor for professional installation. Households that fall below 150% of the area median income are eligible for the HEEHRA program.

HEEHRA Rebate Levels
For Qualified Electrification Upgrades
Income Eligibility and % Costs Covered
Low Income: <80% Area Median Income (AMI)
% costs covered (including installation)
Moderate-Income: <80% Area Median Income (AMI)
% costs covered (including installation)
Overall Incentives
Max Consumer Rebate$14,000
Max Contractor Rebate$500
Rebates for Qualified Electrification Projects
Heat Pump HVAC$8,000
Heat Pump Water Heater$1,750
Electric Stove/Cooktop$840
Heat Pump Clothes Dryer$840
Breaker Box$4,000
Electric Wiring$2,500
insulation, air sealing, ventilation

Whole Home Energy Reduction Rebate Program (HOMES)

The Homeowner Managing Energy Savings (HOMES) rebate program was created to encourage families to cut back on their energy use and will reimburse homeowners anywhere from $2000-$8000 to homeowners who cut their energy use by 20%-35% (or more). Low- and middle-income households can save $4000-$8000 or 80% of project costs. High-income households can save $2000-$4000 or 50% of project costs. The HOMES rebates are based on the performance of energy savings measured by a threshold of either 20% modeled savings (pre-upgrade) or 15% measured savings (post-upgrade). The more energy you save, the bigger the rebate.

Are Rebates Available Now?

The HEEHRA and HOMES rebate programs will start sometime at the end of 2023 or the beginning of 2024 through state energy offices, depending on federal guidance from the Department of Energy. Be sure to check with Best Home Services to see if rebates are available when you’re ready to purchase.

Tax Credits and Rebates—what’s the difference?

Tax credits are given back when you file your taxes. You can earn up to $3200 in tax credits with the 25C tax credit every year.

Rebates are off-the-top discounts on the purchase of qualifying appliances or equipment. Rebates will be available near the end of 2023 or the beginning of 2024. Contact Best Home Services to stay updated on the latest news on when rebates will be available in your area.

How do I save on my home upgrades today?

Take advantage of the 25C Energy Efficient Home Improvement tax credit and ask our professionals at Best Home Services how you can maximize savings with qualified energy efficient upgrades. The Best Home Services team is ready to help you every step of the way.

Fill out our contact form to learn more information on how to take advantage of the $369 billion Inflation Reduction Act.

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