2025 Federal Air Source Heat Pump Tax Credit
2025 Heat Pump Tax Credits
The federal heat pump tax credit allows you to claim up to 30 percent of the installation of an air source heat pump with a maxiumum credit of $2000. This tax credit is effective for products purchased and installed between January 1, 2023, and December 31, 2032. In general, all ducted heat pumps that have earned the ENERGY STAR label are eligible, as well as certified mini-split systems (non-ducted) with:
Ducted Heat Pumps (North) ENERGY STAR Cold Climate Designation
Ductless Mini Split (North) ENERGY STAR Cold Climate Designation
- SEER2 ≥ 16
- EER2 ≥ 9
- HSPF2 ≥ 9.5
2025 Federal Heat Pump Water Heater Tax Credit
2025 Hybrid Heat Pump Water Heater Tax Credits
The federal heat pump water heater tax credit allows you to claim up to 30 percent of the installation of a hybrid water heater with a maxiumum credit of $2000. Heat pump water heaters that have earned the ENERGY STAR are eligible for this credit.
2025 Federal Furnace Tax Credit
The federal furnace (Natural Gas, Oil) tax credits allows you to claim up to 30 percent of the installation of a new furnace with a maxiumum credit of $600.
2025 Gas Furnaces Tax Credits
ENERGY STAR certified gas furnaces with AFUE greater than or equal to 97% are eligible.
2025 Oil Furnaces Tax Credits
ENERGY STAR certified oil furnaces that use certain fuels are eligible. The equipment must be rated by the manufacturer for use with fuel blends at least 20 percent of the volume of which consists of biodiesel, renewable diesel, or second-generation biofuel.
2025 Federal Hot Water Boiler Tax Credit
The federal hot water boiler (Natural Gas, Oil) tax credits allows you to claim up to 30 percent of the installation of a new boiler with a maxiumum credit of $600.
2025 Gas Boiler Tax Credits
ENERGY STAR certified gas boilers with AFUE > 95% are eligible.
2025 Oil Boiler Tax Credits
ENERGY STAR certified oil boilers that use certain fuels are eligible. The equipment must be rated by the manufacturer for use with fuel blends at least 20 percent of the volume of which consists of biodiesel, renewable diesel or second-generation biofuel.
2025 Federal Electric Panel Upgrade Tax Credit
The federal electric panel upgrade tax credit allows you to claim up to 30 percent of the installation of a new electric panel with a maxiumum credit of $600. Any improvement to, or replacement of, a panelboard, sub-panelboard, branch circuits, or feeders which:
- is installed in a manner consistent with the National Electric Code,
- has a load capacity of not less than 200 amps,
- is installed in conjunction with, and enables the installation and use of any qualified energy efficiency improvements, or any qualified energy property (heat pump water heater, heat pump, central air conditioner, water heater, furnace or hot water boiler, biomass stove or boiler)
Annual Limits on Energy Efficient Home Improvement Tax Credit
In addition to limits on the amount of credit you can claim for any particular equipment installation or home improvement, there are annual aggregate limits. The overall total limit for an efficiency tax credit in one year is $3,200.
This breaks down to a total limit of $1,200 for any combination of home envelope improvements (windows/doors/skylights, insulation, electrical) plus furnaces, boilers and central air conditioners.
Heat pumps and heat pump water heaters are subject to an annual total limit of $2,000.
