Federal Tax Credits and Rebates You Should Know About Before Purchasing a Heat Pump

Upgrading to an energy-efficient heat pump can save you money on your utility bills while providing a more comfortable home environment. Knowing about available federal tax credits and rebates before purchasing a new heat pump can further increase your savings. Indoor Air Quality, Inc., a Denver-based HVAC company, is here to help you navigate the financial benefits that come with upgrading to an energy-efficient heat pump.

Federal Tax Credits

With the the Inflation Reduction Act, the federal government has made a 30 percent tax credit available for a range of heat pump solutions — up to $2,000 per year.

Tax Credit Requirements

To qualify for these tax credits, you must meet specific requirements:

• The heat pump must be installed in your primary residence.
• The product must meet the new energy efficiency standards set by the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Energy (DOE).

Rebates and Incentives

In addition to federal tax credits, some utility companies, manufacturers, and state programs provide rebates and incentives for installing energy-efficient heat pumps. To explore your options, you can:

• Xcel rebates have tripled in 2025!
• Consult with Indoor Air Quality, Inc., for information on current rebate offers from manufacturers and installation specials.

What’s Included in a Heat Pump Installation Quote?

When you request a heat pump quote, you’ll want to understand exactly what’s included. By hiring a trusted HVAC company, you avoid hidden fees and receive a transparent breakdown of costs upfront.

Example Heat Pump System Costs in 2025 in the Denver Metro Area:

• The cost of purchasing and installing a Rheem Endeavor RD18AY 3-ton heat pump is $20,000 – $23,000.
• Rebates in this situation would be $6,750.
• Tax credits would be $2,000 from federal tax credits and $1,500 from state rebates.
• This system includes a back up furnace and thermostat.
• The total cost after rebates and tax credits is $9,750 – $12,750.

Indoor Air Quality, Inc.: Your Denver HVAC Experts

At Indoor Air Quality, Inc., our knowledgeable professionals are dedicated to staying current with industry advancements and providing expert advice on the best energy-efficient heat pump options for your home. We’re here to guide you in maximizing the benefits from available tax credits and rebates.

Our customer-focused team takes pride in offering prompt service and maintaining our commitment to cleanliness during service calls. With extensive experience and certifications like the North American Technician Excellence, Inc. (NATE) certification, we are equipped to support homeowners throughout the Denver metro area, ensuring a smooth process from purchase to installation.

Before you purchase a heat pump for your home, let Indoor Air Quality, Inc. assist you in understanding the available federal tax credits and rebates. Reach out to us today, and together, we can work towards creating a more energy-efficient, comfortable space for your family.