
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






Update:12/18/25
Stacy did an absolutely wonderful job checking our hvac system. In addition my husband asked about insulation and as it turns out Goettl does indeed do insulation. Stacy spent a lot of time taking pictures of our attic and showing them to us and patiently explained everything to us.
He is a very pleasant and friendly person and I would not hesitate to have him do all of our hvac inspections. He was very thorough and even checked our outside a/c unit and changed the Capacitor.
Benton was equally pleasant and very helpful on the phone and we booked the insulation install for the following week.
I would not hesitate to recommend Goettl. Customer service counts a great deal to me and Goettl really takes care of it's customers.
Update: 12/19/2026
Tim Theriot reinsulated my attic today. As usual for Goettl teams, he did a wonderful job. He and his team member (Francisco?) cleaned up nicely.
Benton again was wonderful to deal with.



Excellent service from start to finish. My service technician, Josue Diaz, went truly above and beyond. He was professional, knowledgeable, and took the time to explain everything clearly. You can tell he takes pride in his work and genuinely cares about doing the job right. I couldn’t have asked for a better experience with Goettl. Highly recommend both Josue and the company.





I’ll post an up dated message when the guys finish the work! Work is done! Just waiting on concrete and inspection! Zack Adolfo Jalen Sam Chis have been outstanding! There work ethics have been phenomenal very very pleased with the work just waiting to finish everything up so I can get my house back thank you Goettl Plumbing!







...... we had an AC problem a few days later. Peter Medelez from Goettl came out and fixed it expertly and made some recommendations to ensure it won't happen again. Some things hadn't been done correctly when it was installed several years ago (by someone else), and he will be back next week to fix them. I highly recommend Goettl.
... 10/15/25 ... we had a leak in the main water line which was running into the neighbors' yard. In less than two hours of calling Goettl, Clayton Purvis arrived to fix the leak. He repaired the leak and fixed connections, and repaired something previously done incorrectly in the unknown past. He was done before we had to leave for a prior equipment. I feel confident in the quality of work, as I always am when I have to call Goettl for something.
12/17/2025. Tyler Brockhausen was the technician from Goettl who inspected our heating system today. He did a thorough check and changed the filter. He covered his shoes every time he entered the house, left no mess on the floor. It is comforting to know that all is working correctly.


Eric and another man came to my house to clean my ductwork. Goettl had explained to me about promotion during my winter rejuvenation. Eric explained the procedure to me. Helped take down some child gates and then helped replace them when done. Always kept me informed of status and explanation of findings. Goettl may be on the costly side but well worth it. Communication is great and Smart Sadie program is great.
Again Eric and the other man (I apologize for not remembering his name) were friendly and always communicated what was happening.

Both your Plumber Technician, Josh Munoz and his Service Manager, Ben Tracy were extremely helpful.
Josh drained the hot water heater and conducted a thorough inspection of all our plumbing – both floors – inside (5,500 sq ft) as well as outside and identified several issues which he quickly set about fixing.
Josh was friendly, informative and professional throughout the entire process and served as a great representative of your company and team.
Speaking of which – every time Josh needed to check in with management Ben made himself available as a resource. It was clear that they were working as a team.
Once again ➡️ Thanks for all the great work and special kudos to Josh.






But you can’t put a price tag on your life!!
So thanks to my hero.

work.
Just want to thank Goettl for hiring such coptenent personnel that have good personality if could give him 5 stars they do such an outstanding job! JOHN! And ABEL



Stacy was very professional and knowledgeable. He explained everything showed me pictures and explained some options for me. He explained some parts are starting to wear. Thank you Stacy for your service. I would recommend him.
Jesus and Andrew were very professional and knowledgeable about my service and explained and booked my services. Showed pictures and explained other packages that are a available. They both were very pleasant. I would recommend them.









Douglas was thorough and checked for leaks. We found that the issue was a main water break. He was unable to check my water heater since the water in it drained without any water pressure. He unplugged my water heater to avoid damage to the elements. He also suggested To leave the hot water valve open, once the water came back on. Water returned after midnight. I allowed the tank to fill and plugged it back in. I had hot water this morning.
I had a follow-with Daniel, since I needed further information on understanding my Sensi thermostat & my heatpump funtions. His patience and explanations were exemplary! Awesome experience. Thank you Daniel!



Pipes, all under the house with low clearances. Alan and partners did a very professional and considerate work. I'd recommend them to anyone.





Update: Eric and Momo came out afterwards to clean the HVAC coils and ducts, and they also provided amazing service and also went above and beyond. Thank you both for your kind, helpful, and efficient work!




Knowledgeable. He made sure to explain what my visit was for and what to expect. He let me know what he found and was able to fix what needed to be fixed. He was early and accomplished the work quickly.

Incredible service from Brent, who came out and was incredibly knowledgeable in his craft. Can't say enough good about the guy. Thank yall for taking care of us!







He represented Goettl well.

We ended up needing a new unit. While I'm sure Goettl isn't the cheapest in town, for something at necessary as a good AC unit, you get 5 star service with your purchase. So far, we are happy with our choice.
Jorge didn't try to up-sell us. He was honest and realistic. If I could opt for him to come to every service call, I would. God Bless you Jorge!
12/2025: Andrew was AMAZING 👏 He is really knowledgeable. He took the time to explain what was going on with our heating system and spent extra time helping us out!

He did an excellent job on the entir9mme system. I'm very pleased at Goettl's standards. Thank you. I will definitely have them back again!!!

Excellent service.

December 2025: we just had our annual HVAC rejuvenation. Josue Diaz was a great technician. He checked all of the systems with a detailed list. When he noticed that we don’t have refrigerant locks on the outdoor unit he installed them free of charge.
Our most recent service with Goettl was a new HVAC system - Blake and Oscar were not only great at the technical parts of their job, but also at showing me some things I can do to help maintain the system between the regular maintenance that I have done through the Sadie Club membership. It is the little things that can make a huge difference, like leaving the box for the filter in a logical place so that I have a visual reminder of exactly what I need to order in 6 months. I could have taken a photo, but then I'd have to go find the photo.
Blake and Oscar were here for a long time installing the new system and checking that it worked. But honestly if it weren't for the drop cloths they put to protect my floors I probably could have forgotten they were here - they were so quiet and efficient. I had been expecting that it would be loud, but I could have worked from home with them installing and not have had an issue - if my daughter was still a baby I probably could have had her napping at almost any time of the process!
Overall, I could not be more impressed with the service I've had from this company and I look forward to working with them going forward to maintain my home and systems. And a quick note about the Sadie Club - they call you when the included maintenance is due - no more paying for something and forgetting to use it.

was professional, kind, knowledgeable, thorough and fixed the problem. Stephen for the win!!!! Would recommend Goettl to anyone. We have tried lots of other companies but stopped trying them when we found Goettl. They are the only ones we use for any HVAC or plumbing issues. Great, friendly service.



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!

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!

My wife and I are upgrading our home with the new water purity package and cannot wait to try our new water.Thank you Joseph or the service you provided and information you shared.I highly recommend joseph and goettl!



I look forward towards the next project. Thanks!





By the end of the day, I had hot water and Mark left no sign of a mess behind.
I was surprised at such fast service and impressed by everyone I interacted with.
Great company!







Tai Fernandez-Estabillo, service rep is excellent. I deal with a lot of contractors in my student housing operation and he is at the top of his field. Proud to know him. Thanks for the professional service Tai.












He certainly understands what Customer Service is all about!
Joey was on time, well-mannered, and very professional. He took care of our problem, took time to explain all aspects of the project in detail, and left the work area nice and clean.
We will definitely utilize Goettl’s services in the future, as needed and have nothing but the highest praise for Joey Martin!












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

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!


