
Federal Tax Credits and Rebates for Home Upgrades: Everything You Need to Know
If you upgrade your home’s heating and cooling appliances without knowing the available tax credits, you leave money on the table. The recent Inflation Reduction Act of 2022 (IRA) provides several credits from the federal government to reduce your tax bill for eligible upgrades.
Learn about the IRA and other tax credits and incentives for home improvements, how they can save you money at tax filing time, and how to determine your eligibility.
Understanding the Inflation Reduction Act
President Biden signed the Inflation Reduction Act in 2022, encompassing legislation that reduced prescription drug prices, extended some of the Affordable Care Act, and implemented funding for climate initiatives, including tax credits and rebates for homeowners.
The IRA includes specific tax credits and rebates for homeowners who install new HVAC systems or upgrade their current systems, such as heat pumps. However, there are eligibility requirements and limits.
25C Energy Efficient Home Improvement Credit
The 25C Energy Efficient Home Improvement Credit offers tax credits for qualified energy-efficient improvements to your home. Starting January 1, 2023, homeowners may qualify for a tax credit of up to $3,200 for upgrades made through December 31, 2032.
25C can equal up to 30% of certain eligible expenses, including:
- Qualified energy efficiency improvements installed during the year
- Residential energy property expenses
- Home energy audits
However, the allowable annual credit and the credit for certain types of qualified expenses have limits, which can be confusing.
There’s a maximum allowable credit for each year:
- $1,200 for energy property costs and specific energy-efficient home improvements with a limit of $250 per door, $600 for whole-house window installations, and $150 for energy audits.
- $2,000 annually for qualified heat pumps and biomass stoves, boilers, and ENERGY STAR® air conditioners.
While there are limitations, you can claim the maximum annual credit each year that you’ve made eligible improvements through the end of the 2032 tax year. The credit resets yearly, so you can use it repeatedly for qualifying energy upgrades.
Note that this is a tax credit, which means it’s an amount you can subtract from your tax liability (the taxes you owe). A tax credit only applies if you owe taxes at the end of the year. It’s not a deduction or a refund. You can’t apply the extra amount to a future tax year if there’s a higher credit than your tax liability.
Which Upgrades Are Eligible?
To be eligible, you must be a taxpayer living in a home or apartment and purchase or install the upgrades. The credit only applies to upgrades on existing primary homes, not secondary properties—like rentals—or new construction.
So, if you’re a landlord, you can’t make energy-efficient upgrades to your vacation home or rental properties and take the tax credit. However, different tax credits may apply to upgrades for second homes.
Eligible appliance upgrades include:
- Insulation and air sealing (weatherization): This includes the supplies used to insulate and seal your home against air leaks, such as insulation bats, expanding spray foam insulation, and sealants. According to the Department of Energy, weatherization upgrades have to meet the recommended R-values for your climate zone to be eligible for the upgrade.
- Energy-efficient windows and doors: You can replace your exterior doors and windows with ENERGY STAR® certified doors and windows, but there are limits. You can spend up to $600 of the credit on windows, $500 on doors, and no more than $250 on one door.
- Heating, cooling, and water heating systems: Central air conditioning, heat pumps, and heat pump water heaters (HPWHs) may also be included. Gas, propane, or oil furnaces and water boilers may also be included.
- Energy audits: Energy audits are assessments that determine where you’re losing energy and how to optimize your home for maximum energy efficiency with tailored solutions. This is an important step in determining the best way to maximize your spending on upgrades, and you can apply $150 of your credit toward a professional audit.
Remember to upgrade HVAC appliances that meet the highest energy efficiency standards, which generally means ENERGY STAR® certified appliances.
How to Apply for 25C Tax Credit
Getting a 25C properly credited to your taxes can be complicated, so working with a tax professional is best. The general process includes:
- Install qualifying upgrades to your home.
- Keep your receipts and documentation for the upgrades. Include what you purchased and installed, who installed it, and how much it cost. Retain copies for your records.
- Tell your tax professional you plan to use the 25C tax credit. This can help you plan your tax filing.
25C tax credits are filed using IRS Form 5695.
Rebate Programs
Tax credits like 25C require taxes owed for homeowners to cash in, but it doesn’t matter if you owe or get a refund to take advantage of tax rebates. Here are some rebate programs for homeowner energy-efficiency upgrades:
Home Energy Performance-Based, Whole House Rebate (HOMES) Rebate Program
The Home Energy Performance-Based, Whole House Rebate (HOMES) Rebate program is intended to help homeowners save on energy bills with point-of-sale rebates for eligible home weatherization and electrification improvements. Some eligible rebates include air sealing, insulation, heat pump HVAC systems, and HPWHs, which you’ll receive when you purchase.
For example, a qualifying rebate would replace a dated HVAC system with a mini-split heat pump system. Homeowners can claim up to $2,000—or 30% of the cost—toward purchasing and installing the heat pump and any necessary electrical upgrades.
State-based programs under HOMES offer low- and moderate-income households rebates of up to $8,000 on heat pump installation and $4,000 on electrical upgrades.
Home Electrification and Appliance Rebate (HEAR)
The Home Electrification and Appliance Rebate (HEAR) incentive program is a $4.3 billion program part of IRA that assists homeowners with rebates at the time of sale, not with a mail-in rebate or a rebate at tax time. Instead, the rebate is applied at purchase, offering $8,000 to lower the purchase price for heat pumps used for home heating and cooling.
In addition to heat pumps, heat pump HVAC systems, and HPWHs, the program may include qualified electrification programs like electric stoves and cooktops, air sealing and insulation, wiring and ventilation, and some purchase and installation costs.
Like HOMES, HEAR is intended for low—to moderate-income homeowners. If your income falls below 80% of the median income in your area, the program may cover up to 100% of the electrification costs. If your income falls between 80% and 150% of your area’s median income, you may receive up to 50% of the costs. Both programs are capped at $14,000.
HOMES and HEAR can vary based on household income, the type of upgrade and its efficiency, and your state’s rules and requirements. The specifics are up to each state and may be first come, first serve, or random, so it’s best to plan early to get your rebates when the programs are implemented in your state.
How to Maximize Your Tax Credit
Though it flew under the radar, the IRA and 25C tax credits and the energy-efficiency rebates greatly expanded the benefits for eligible homeowners. The credits and rebates do have qualifying appliances and limits, so it’s best to plan your upgrades to ensure you get the most out of them.
- Make sure your home is airtight. Air leaks and damaged insulation are responsible for up to 45% of energy waste in your home. There’s little point in upgrading to a new energy-efficient HVAC system if you only lose your heated or cooled air from leaks.
- Upgrade your HVAC to an energy-efficient heat pump. These systems are far more energy-efficient than conventional ones and can replace heating and air conditioning in one unit. Heat pumps also dehumidify and filter your home and work with existing ductwork. If you prefer ductless, heat pumps can provide zoned heating for more personalized comfort. Heat pumps can have high upfront costs, but with the available tax credit, now is the time to upgrade.
- Look into state incentives and rebates. IRA is a federal program, but individual states may offer additional incentives and rebates that you can combine with federal incentives. Consider your options and plan your upgrade strategy with a tax professional and an HVAC professional to maximize the savings.
Upgrade Your Home with Energy-Efficient Appliances for Energy and Tax Savings
With sweeping legislation like the IRA and 25C tax credit, now’s the time to upgrade your home’s appliances to enjoy a tax break and long-lasting energy efficiency savings.
Are you unsure what’s best for you? Goettl Air Conditioning can help! Contact us to discuss your home’s energy-efficient upgrades!
The factual information regarding IRA 25C and 3C-REN programs is for educational purposes only. Consult with a tax professional for personalized advice regarding your eligibility and incentives. Goettl is not responsible for the rebate amount customers may receive.
Testimonials
What Our Customers Say About Us



Devin performed my plumbing inspection. He is knowledgeable and courteous.


What truly stood out was his attention to safety. He identified a carbon monoxide concern in our home and made sure we understood how serious and dangerous it could be. José explained the risks in a calm, respectful way and ensured we knew what steps to take to keep our family safe.
His professionalism, knowledge, and genuine care went above and beyond. We are incredibly grateful for his honesty and dedication, and we highly recommend José Carreon to anyone needing HVAC service.
Thank you , Goettl for hiring the best technicians!






















Jesus was terrific, thorough, and personable. Made everything so easy for me.
I just had my second yearly inspection with Francesco Tocci. I cannot say enough good things about him. He is prompt, professional, personable, and takes the time to explain his findings to me and what he will do about them. Now, in fairness, all of the technicians from Goettl are great. But Francesco stands out because of his gregariousness. It is obvious that he loves his work and truly cares that his clients are happy with the job he does.





We installed a new AC unit...we got a best price...and the same day day they show up, and 9 hours later...the new ac was on working. Well we have had scheduled an appointment for today for AC mentanance....the technician Kevin Schroeder show up on time...he was very professional, very knowledgeable...polite..and permanently he try to assure us about everything . Such a great person, and a joy to be in our house . Strongly recommend Goettl company, and it's a pleasure to recommend this technician ! Great job Kevin 👏







I initially had a rocky start with one particular representative, but the Goettl team stepped up and made it right, which says a lot about their integrity as a company. Billy did an outstanding job and made sure my system was safe, fully operational, and gave me real peace of mind.
Thank you to management, Josh and Josue, for personally ensuring the job was completed to my satisfaction.





What stood out the most was their attention to detail and genuine care for customer satisfaction. They took the time to assess my system thoroughly, offered honest recommendations, and completed the work efficiently without cutting corners. My home is now noticeably more comfortable, and I feel confident knowing everything was handled by true professionals.
If you’re looking for reliable, top-quality HVAC service, I highly recommend Goettl. They truly live up to their reputation and exceeded my expectations in every way. Thank you Jose Carreon

Isaias was wonderful! He was professional, approachable, knowledgeable, kind, and timely. I highly recommend him!

Thank you
Dave and Kathy Halvorson






Not thrilled about the cost. But I think it was fair.

Nick, Julian, and Josh were at my home for four days. They did a meticulous job, cleaning up every day with no debris left. They were responsive to my questions and took pride in their work. They explained the work to be done in great detail.
The work team was terrific, and I would have no hesitation in using them again or recommending them.





Did a great job. Answered all of my questions and showed me how to take care of my equipment. They talked to me not at me. Thank you both of you.
Patty 🤗🌷🌵



And no, they didn't "invent" a problem. They solved it.



Added: Brayan was also exceptional. He and his Coworker were very professional, courteous and timely. I couldn't have asked for better service!


Thank you








Update on 1/10: Ashton was very helpful and informative. He did a good job and gave good communication!





Ashton was a great tech. Jumped right into the maintenance check ensuring our systems were up and running as should be. Following his tune up and inspection, Ashton thoroughly went over all his findings before cleaning up.
Nate is a fantastic Goettl tech. Came out to fix one problem but quickly realized the diagnosis was not correct. Stayed at our house, relentlessly working to figure out the issue all while in a house with no A/C, registering indoor well above 90. Thanks to Nate, David and Goettle for getting us back up and running and taking care of us and making the invoice total right. Great customer service in this experience.
12/21/24
Jeremy was fantastic. They were able to get us in earlier than scheduled. He remembered the house and was able to due the maintenance tune up and test the system in no time. Great experience.
12/26/24
Francesco is a top notch plumber. On time and got right to work. Did all his inspections and was in and out in no time. Stuck around after his inspection to talk about what he found and made some minor recommendations. Awesome experience.
















Julian and his team (Joey, Jeran, and Alonso) are extremely knowledgeable, efficient, and worked hard to get us back up and running as quickly as possible. Upon completion they send a detailed email with pictures.





Thank you!

Update: 1/7
Stacy excellent service excellent job well done professional communication excellent explain everything on the up to date stuff I need to do in the future appreciate your service have a nice day thank you






This January's visit with Kevin

I am very satisfied with my Goettle services, their employees, including the scheduling staff, and highly recommend this company.

We have known our water heater was at the end of its life. Goettl came in to do maintenance. Brent S. was our technician. He was very kind and knowledgeable. He explained the different options and we ultimately decided to replace our water heater with his help.
We were able to get it replaced same day. The crew who replaced it Zach C. (and I think Darrius?) did a great job replacing the water heater. Happy with everything!
Was having AC issues and a technician was able to come out the same day we called. Chris Rios did a great job showing and explaining in detail the problems we were experiencing with our unit. In the end, it was best for us to replace the entire unit. A crew was actually able to come out the next day to install the new unit. Juan and Carlos did the installation and did a great job! They were on time and were thorough. Happy with the entire process!


Goettl plumbing supervisor, Craig Cooper, arrived to survey the problem. Craig determined the valve had been incorrectly installed during the previous water system installation. Craig immediately contacted water mitigation supsrvisor, Ethan Gray at Quick Restore LLC.
Craig coordinated with Ethan the construction, drying of walls/carpet and services for the boxing and storage of our personal property. The reconstruction and repair work was done professionally and in an outstanding time frame for me to undergo major spinal surgery.
I wish to thank Craig for his outstanding integtity and attention to detail for this undertaking. He arranged for Goettl to cover all the costs involved for the work, boxing, moving, storage and water mitigation.
We are so very grateful to Goettl for their wonderful work ethic, technicians and supervisors. We absolutely continue to use and wholeheartedly endorse Goettl for all our AC and plumbing services! Thank, you again Craig!




Parker was very pleasant, knowledgeable and respectful of us and our home.
You’ll be in good hands with Parker and Goettl







Update: I accepted your proposal and wow, three days later my house has heat and air. Installation time was a little over five hours with breaks, and all the time your crew worked efficiently and professionally. Nothing left undone. A big THANK YOU for you guys.
Update2: Goetti set up the building permit appointment with the county, and attended the inspection, which past with no issues. Other companies that I have dealt with have not done so much. Furthermore, I did get multiple estimates, and all the other companies had convenient add-on's which proved by the inspection were a unnecessary expense, thus making Geotti price the lowest and most honest of them all. By the way, the heater and a/c have work to perfection and are both very quiet.
Follow up: A home inspection showed a small issue with my new furnace, so I called Goettl. Next day service and they determined there was an issue with the furnace they installed. Two days later (Christmas Eve) a brand-new furnace was installed. No debate, new questions asked, no cost to me, they insisted. This was quit the contrast to what I experience with other HVAC companies I have dealt with in my forty years in Reno.





Highly recommend Goettl Air Conditioning and Plumbing!!!


A short history. A few years ago, we had four seasons put in a new furnace. After checking around and getting tons of estimates, there was as much as a $10,000 difference between all of the estimates. Four seasons came in at the best price. Unfortunately, I ordered an 80,000 BTU furnace and when the guy was done, I looked at the furnace and saw that it was a 60,000 BTU. I showed the guy the invoice and basically his response was ‘ Oh crap’ so I talk to the manager and he assured me that 60,000 BTU would heat my home sufficiently since it was a high-efficiency unit.
I was ready to have them tear it out and put the right one in, when the manager guaranteed the furnace and gave me the price for the 60 KBTU with a substantial discount. I did the regular maintenance and service service with four seasons.
When Goettl took over, I’m not sure if they just change the name, or bought four seasons, but everything changed after that. First I was informed of a membership called Sadie which is basically a yearly/monthly fee that allows us to get a lot of benefits. Free service calls, free, free preventative maintenance and discounts on non-covered items.
The first thing that I noticed was Josh came in to do a service, check the pressure and saw that the original installation guy did not convert my furnace to propane. Apparently none of the other service people ever checked the pressure. He had to return with the correct parts and changed out the valve. He also helped me out with a bathroom heating duct that was ripped. The price was great and he said he felt bad that we had such issues with the previous company.
A few months later (last Saturday) we stopped getting heat. I called Goettl let them know, and they were at my house within two hours. When it’s freezing outside or going to be subzero it’s really important when they respond so quickly.
Chris was the technician and he found the problem, however, the plumbing supply company was not open till Monday morning. Two days with sub, freezing temperatures scaring me a bit. Chris said that he would check with Dispatch and see if they had a couple of space heaters. When he was leaving, he noticed we had a bunch of firewood on the front and he offered to help bring firewood in. I told him no problem we had it, he said he was happy to help us. Make sure we had enough firewood to get through two days.
These two offers, were above and beyond in something you really wouldn’t expect from your HVAC people. Unfortunately, they didn’t have any space heaters at Dispatch, so we went to Home Depot and got some radiator heaters and then yes 24 hours a day kept a fire going.
Chris showed up Monday about 11 AM with the parts and it took him about 2 1/2 to 3 hours to fix all of the problems. I’m not savvy with all of the HVAC terms, but something about condensate water bill backed up through the system blah blah blah… we now have heat. lol.
Getting the Sadie member membership/club was the best thing we decided to do. They call us regularly to schedule our summer and winter maintenance. They are responsive. And they are very polite every time I call them.
I really would recommend you contacting them and get on that membership before you actually need them. Thank you, Josh and chris and unfortunately, I cannot remember the name of the female technician that came out and changed our filters but she was awesome also!






Like most people, I typically search for the cheapest service I can find, and I end up having other plumbers come out to check out issues with my tankless water heater, who run their mouths, upsell parts (that don't seem to be causing the problem), and generally don't really know enough about tankless water heaters. This time, I decided to go with an experienced company with a good reputation, and I am glad that I did - Goettl's prices are very reasonable and worth the service they provide.
Juan, was very knowledgeable, patient, and persistent. Even better, he was careful and humble enough to acknowledge that he didn't know everything and checked with the manufacturer at every step. Juan spent a great deal of time helping me diagnose the problem (which always seems impossible to ascertain quickly with machines like tankless water heaters), and went above and beyond to ensure that my guests and I had hot water tonight.
Juan never got frustrated; he handled everything carefully and made sure to clean up after himself when he was done. If I can have Juan take care of all of my plumbing or AC issues in the future, I will. And if you're reading reviews to decide whether to call Goettl for your issue, I would encourage you to trust their service and experience. My experience with Juan was definitely memorable.
We now have hot water again. Can I get a "hell yeah"?


We had a concerning plumbing issue, and Geo was able to diagnose the problem with impressive speed and accuracy. What I really appreciated was that he took the time to clearly explain what was wrong, showed me what he was looking at, and gave me honest, practical advice on the best solution.
He had the issue resolved in no time at all. The whole experience was seamless, from the quick scheduling to the efficient and high-quality work. It’s so refreshing to find a technician who is not only a master of his craft but also a genuinely kind and trustworthy person.
A huge thank you to Geo and the entire team at Goettl. You have a customer for life! If you need a plumber, ask for Geo—you’ll be in the best hands






I have seen Goettl vans all over town and so I called them.
Got appointment right away and the Technician, Jef Eusepi, took care of our problem.









Thank you,
Greg Sanches





















This past week our service technician was Andrew Morgan and he is such a friendly, knowledgeable, and skilled technician. He spent time making sure the job was done correctly and he explained it in terms that I could understand. Not only is our unit functioning even better than before, I also gained knowledge of how the system works.











I highly recommend Goettl as this is the second time l've used them in less than a year. (2 seperate issues)... and I highly recommend them..anytime and anyday.
They have exceeded to top any expectations I could have ever had with any company.






The company is installing a tankless heater and the customer service is outstanding.
I recommend Geottl to all!


They made sure my carpet was covered and when they were all through they cleaned up perfectly
I would recommend your company to anyone looking to put in a new air conditioner.
Thank you so much for all you did for me.
Sincerely, June Jones

And I would highly recommend the company and the quality technicians like Jarod.
Jarod is the go to if you want excellent
Customer service and communication for any AC related issues. He is very knowledgeable, personable and trustworthy. I am grateful and satisfied.





They listened to my issue, were very through, checked for leaks, etc. I’ve lived in Lakeway for 30 years, used MANY local plumbers - but Goettl will definitely get all my business moving forward. HIGHLY recommend!
Ty, Wil & Adrian!
