How to Get an HVAC Tax Credit

New HVAC systems are an important investment, but some homeowners struggle to fit high-efficiency installation projects into their budget. To reduce emissions and improve communities’ energy efficiency, the federal government has created numerous programs designed to lower costs.

Everyone at Arctic Circle Air believes you deserve the highest standards of comfort. We’ve compiled a few key details about these programs to help you improve your home’s HVAC system. We can recommend high-efficiency products that are eligible for the federal tax credits for HVAC systems. We can even provide seamless installation, ensuring your new system offers peak performance from the start. If that sounds like a good deal, give us a call at (770) 268-0227 today.

Tax Credits as Part of the Inflation Reduction Act – Explained

The Inflation Reduction Act of 2022 launched a comprehensive federal initiative with funds totaling $369 billion. The program was created to mitigate inflation and its impact on homeowners. The Act offers large rebates and tax credits to homeowners and even qualifying renters who are investing in energy-efficient upgrades. This includes equipment like heat pumps and air conditioners as well as accessories like insulation.

Eligible homeowners can offset some if not all of the costs of purchasing and installing high-efficiency HVAC technology. Leveraging these benefits makes it much easier to enhance the energy efficiency of your home at more manageable costs.

How the Inflation Reduction Act Affects You

How homeowners get tax credits and rebates from the Inflation Reduction Act or other programs depends on their incomes. For flexibility, multiple programs are available. We’ll discuss two such rebate programs. HEEHRA and the Inflation Reduction Act.

Formerly known as the Zero-Emission Homes Act (ZEHA), the High-Efficiency Electric Home Rebate Act (HEEHRA) provides rebates for low- and median-income households across America for energy-efficient appliances and utilities. This includes HVAC systems like heat pumps as well as accessories like ductwork or insulation.

Securing the rebates and credits from these programs will depend on your household’s income levels. There are multiple programs to choose from with varying requirements: HEEHRA and the Inflation Reduction Act.

Previously known as the Zero-Emission Homes Act (ZEHA), the High-Efficiency Electric Home Rebate Act (HEEHRA) extends rebates to low- and middle-income households nationwide when they adopt energy-efficient appliances and utilities. This includes a number of HVAC systems like air conditioners, furnaces, heat pumps and even ductless mini-splits.

  • Low-income homeowners qualify if their income is less than 80% of the area’s median.
  • Moderate-income homeowners, meanwhile, can meet anywhere from 80-150% of the area’s median levels.

If your household’s income exceeds HEEHRA restrictions, don’t worry. You’re still eligible for a tax credit from the Inflation Reduction Act itself, which offers a 30% tax credit up to $1,200. Particularly energy-efficient systems like heat pumps offer additional savings, so take that into consideration.

HVAC Systems That Qualify for Tax Credits

In general, only high-efficiency systems are eligible for HVAC tax credits. While what constitutes high-efficiency varies between different types of products, most qualifying systems are highlighted through the federal ENERGY STAR® program.

You can browse the full list, or continue below for key information about some of the most popular HVAC systems that qualify. To ensure energy efficiency across different climates, eligibility is based on the Department of Energy’s Regional Standards Regulations. The state of Georgia is included in the South region.

Heat Pumps

Qualifying heat pump installations must meet the following minimum energy efficiency ratings:

  • Split-ducted heat pump
    • SEER2:2
    • EER2: 7
    • HSPF2: 8
  • Packaged heat pump
    • SEER2:2
    • EER2: 6
    • HSPF2:2

Air Conditioners

To receive a tax credit for air conditioning installation, qualifying models must meet these energy efficiency ratings:

  • Split air conditioner
    • SEER2: 16
    • EER2: 12
  • Packaged air conditioner
    • SEER2: 2
    • EER2:5


For your furnace installation project to qualify, your selected model has to meet the following energy efficiency rating:

  • Gas-fired, forced-air furnace
    • AFUE: 97% or higher


Both heat pumps and air conditioners qualify as mini-splits, so long as they don’t use the ductwork found with central, forced-air systems. An eligible mini-split should feature the following energy efficiency rating:

  • Mini-split AC
    • SEER2: 16
    • EER2: 12
  • Split heat pump
    • SEER2: 16
    • EER2: 12
    • HSPF2: 9

How to Get Your Inflation Reduction Act Rebate

HEEHRA rebates will be provided at the time of purchase, while those whose incomes don’t qualify can instead claim the tax credit through IRS Form 5695. If you’d like help applying, your local tax professional can help with the process. While some credits have an annual limit, homeowners can claim these credits year after year as long as they use qualifying HVAC products.

Arctic Circle Air can help you with this process, as our technicians and installers have years of experience working with high-efficiency equipment. To learn more, give us a call today at (770) 268-0227.