Inflation Reduction Act

Here’s why Sequim, WA, property owners should care about the Inflation Reduction Act of 2022.

It’s an opportunity—but you need to act quickly! These valuable tax credits expire on December 31, 2025.

Signed into law in August 2022, the Inflation Reduction Act provides tax credits and rebates to encourage Washington homeowners to replace older appliances with high-efficiency equipment that does a better job at a lower operating cost.

How to Take Advantage of the Inflation Reduction Act

Air Flo Heating Company can help pinpoint areas in your home where you can save money and reduce your carbon footprint, allowing you to use the best tax credits and rebates.

HVAC Tax Credits Homeowners Can Claim

The Inflation Reduction Act extends and expands the existing Energy Efficient Home Improvement Credit (Section 25C) and the Residential Clean Energy Credit (Section 25D) to homeowners.

Projects installed by December 31, 2025, may qualify for a 30 percent tax credit:

• Air Conditioners—Tax credit capped at $600
• Heat Pumps—Tax credit capped at $2,000
• Furnaces and Boilers—Tax credit capped at $600
• Geothermal Systems—Uncapped 30 percent tax credit on purchase and installation
• Solar Paneling—Uncapped 30 percent tax credit on purchase and installation

To qualify, the efficiency upgrades must be made on an existing home that is your main residence. Vacation homes do not qualify. Neither do commercial buildings nor rental units.

Here is a closer look at heating, ventilation, and air conditioning (HVAC) products and eligibility requirements:

• All ducted air-source heat pumps with the ENERGY STAR® label.
• Split air conditioner systems must have a Seasonal Energy Efficiency Rating 2 (SEER2) of 16 or more. All packaged systems with ENERGY STAR certification are eligible.
• Gas furnaces must have an annual fuel utilization efficiency (AFUE) rating of at least 97 percent.
• Gas boilers with an AFUE of at least 95 percent qualify.
• Oil-fueled boilers and furnaces must be capable of using fuel blends.

Your project must be installed by December 31, 2025, to qualify for these significant tax credits. Contact our Air Flo professionals today to schedule a free consultation!

HVAC Rebates

The Inflation Reduction Act set aside a $4.3 billion budget, with the money allocated to individual states for disbursement. Funding will vary from state to state, and eligibility is income-based.

For example, the High-Efficiency Electric Home Rebate Act (HEEHRA) covers 100 percent of electrification project costs (up to $14,000) for low-income households and 50 percent of costs (up to $14,000) for moderate-income households.

Here’s how some of those rebates would work:

 

• $8,000 for a heat pump for space heating
• $4,000 for an upgraded breaker box
• $2,500 for upgraded electric wiring
• $1,750 for a heat pump water heater
• $1,600 for insulation, air sealing, and ventilation
• $840 for an electric stove, cooktop range, or oven
• $840 for an electric clothes dryer

Our team at Air Flo can help you determine whether you qualify for federal rebates. Additionally, local utility rebates are often available for many of these home improvement projects.

Buy Now and Save

Up-front costs are typically the biggest obstacle to upgrading your heating and cooling system. The Inflation Reduction Act of 2022 overcomes that barrier. Call Air Flo Heating Company today or request service online to learn more about how to save money.

Here is a summary of the tax credits as they stand now: