HVAC Tax Credits for Indianapolis Homeowners to Consider

Are you a homeowner looking for ways to save money on your heating and cooling bills while also investing in your home’s energy efficiency? As part of the Inflation Reduction Act of 2022, homeowners can receive federal tax credits for purchasing and installing qualifying HVAC systems in their homes. These tax credits can range from a few hundred to a few thousand dollars, making HVAC upgrades an appealing investment for any homeowner.

At Williams Comfort Air, we’re passionate about helping homeowners achieve optimal comfort in their homes while also saving money and reducing their carbon footprint. Our team of HVAC experts can work with you to determine whether you qualify for tax credits and which HVAC system is the best fit for your home and budget. Below, you’ll find more information about the credits you may be able to take advantage of when you install new heating, cooling, or water heating systems.

What HVAC and Plumbing Tax Incentives Are Available for Homeowners?

If you are a homeowner looking for ways to reduce your energy bills, you’ll be happy to learn that there are several HVAC and plumbing tax incentives available. These incentives can help you to save money while also providing a more comfortable and energy-efficient home. With the rising cost of energy, it is more important than ever to find ways to be efficient with our energy usage. By taking advantage of these incentives, you can enjoy a more cost-effective and environmentally friendly home. This section will provide a comprehensive overview of what HVAC and plumbing tax incentives are available for homeowners and the benefits they offer. Read on to learn more and discover how you can make the most of these incentives!

Heating and Cooling Tax Credits

As a homeowner, upgrading your heating or cooling system may seem like a daunting task, but it can also prove to be a beneficial one in the long run. Not only can you save money on your energy bills, but you could also be eligible for federal tax credits.

The US government offers federal income tax credits for homeowners who choose to upgrade their heating or cooling systems with energy-efficient solutions, such as air source heat pumps, central air conditioners, furnaces, and boilers. The Inflation Reduction Act of 2022 extended many existing credits to promote energy efficiency and reduce carbon footprints.

To be eligible for these credits, new systems must meet specific energy efficiency standards established by the federal government. These standards include minimum SEER ratings for air source heat pumps and central air conditioners, as well as minimum AFUE ratings for furnaces and boilers.

  • Homeowners who choose new air source heat pump installation are eligible for a federal tax credit of up to $2,000. With the introduction of newer technology, air source heat pumps are becoming increasingly energy-efficient and can offer up to 50% savings on energy bills compared to traditional heating and cooling systems.

  • Central air conditioner replacement that meet the government’s energy efficiency requirements can also qualify for a tax credit of up to $600. This high-efficiency equipment uses energy while still keeping your home cool and comfortable, and could offer significant savings on your energy bills.

  • Furnaces and boilers that meet the energy efficiency requirements set by the federal government can also qualify homeowners for a tax credit of up to $600. With technology advancing every year, newer models can provide as much as 95% efficiency, making these upgrades worthwhile investments.

Water Heater Tax Credits

If you are a homeowner looking for a water heater replacement, you should not overlook the benefits of federal tax credits available to you. These tax credits can help reduce the initial cost of upgrading your water heater system while also saving you money on your energy bills in the long run.

To qualify for these tax credits, your water heater must meet specific energy efficiency criteria outlined by the government. The energy efficiency of water heaters is measured using a metric called the Uniform Energy Factor (UEF). The higher the UEF, the more energy-efficient the water heater is.

For gas water heaters, the government provides a federal tax credit of up to $600 for homeowners who install a high-efficiency unit. To qualify for this credit, the gas water heater must be ENERGY STAR® certified and have a > 0.81 UEF for tanks less than 55 gallons and > 0.86 UEF for tanks greater than or equal to 55 gallons. While gas water heaters may not be as efficient as some other options, installing a high-efficiency model can still help you save money on your energy bills and reduce your carbon footprint.

If you are looking for an even more energy-efficient option, consider installing a tankless gas water heater. These units only heat water when it is needed, which means they are up to 34% more efficient than standard gas water heaters. Homeowners who install a tankless gas water heater can qualify for a federal tax credit of up to $600. To qualify for this credit, the unit must be ENERGY STAR® rated and have a UEF of 0.95 or higher.

Another energy-efficient option to consider is a heat pump water heater. Heat pump water heaters work by absorbing heat from the surrounding air and using it to heat water, making them exceptionally efficient in warm climates. Homeowners who install a heat pump water heater can receive a federal tax credit of up to $2,000. To qualify for this credit, the unit must have earned the ENERGY STAR® certification.

Geothermal Heat Pump Tax Credits

Installing a new geothermal heat pump in your home is a smart investment that not only helps you save money on energy bills but also contributes towards a sustainable future. To encourage and support homeowners in this endeavor, the federal government has offered tax credits that can cover 30% of the total cost of installation for systems installed prior to January 1, 2033.

It’s also worth noting that the tax credit applies to both new and existing homes and can be claimed for primary residences as well as secondary homes. Furthermore, there is no limit to how much you can claim with this tax credit.

How Do I Qualify for and Claim These Rebates?

Homeowners who install new HVAC and water heating systems that meet federal efficiency standards may qualify for valuable tax rebates under the Inflation Reduction Act of 2022. To qualify for the tax credit, the equipment must meet certain energy efficiency requirements, such as ENERGY STAR® certification or other specific efficiency ratings.

Claiming the credit involves filling out Form 5695 and then adding the resulting credit amount to your tax return. With the right equipment and proper documentation, you can easily take advantage of this valuable tax credit and enjoy reduced energy bills for years to come.

Available Indianapolis HVAC and Plumbing Energy Rebate Options

Did you know that local rebate programs are also available to Indianapolis homeowners? These rebate programs offer additional financial incentives for HVAC upgrades, making it even more affordable to invest in a new system. Below are local rebate programs available to Indianapolis homeowners:

Additional Home Energy Tax Incentives You May Qualify For

As we move towards a greener and more sustainable future, there has been a growing emphasis on reducing energy consumption and increasing energy efficiency in our daily lives. To encourage this shift towards a more eco-friendly lifestyle, the government has introduced several tax incentives for homeowners who take steps to conserve energy, in addition to credits for HVAC and water heater installation.

Electrical Panel Upgrades

If you are planning to upgrade your electrical panel, then you should know that you may qualify for a tax credit of up to $600 of the cost of installation. This tax credit is a great incentive for homeowners to upgrade their electrical systems, as it helps to offset the cost of the upgrade. Upgrading your electrical panel not only helps you save money on your monthly energy bills and the potential for expensive future repairs, but it can also increase the safety and reliability of your home’s electrical system.


When you add insulation to your home, not only will you see a difference in your monthly bills, but you may also qualify for a tax credit of up to $1,200 for making this improvement. This is a substantial credit that can make a significant impact on your overall tax liability. In addition, properly insulating your home can reduce heat loss during the winter and heat gain during the summer, ensuring that your home stays at a comfortable temperature all year round.


If you’re considering installing solar panels in your home, there’s even more incentive to do so now. The federal government is offering a tax credit of up to 30% of the total installation cost for eligible homeowners who install solar panels before January 1, 2033. This means not only will you be reducing your carbon footprint and energy bills, but you’ll also receive a considerable financial benefit.

Windows and Doors

Upgrading your windows and doors to energy-efficient models is a smart move. The good news is that you can also benefit from a tax credit for doing so! You can receive a credit of up to $600 for installing qualified energy-efficient windows, depending on the type and efficiency of the products you choose. Not only will you save money on your energy bills, but you’ll also be doing your part to conserve energy and reduce greenhouse gas emissions.

And if you also replace your doors with energy-saving models, you can claim a credit of $250 per door, up to a maximum tax credit of $500. When you consider the long-term savings on your energy bills and the positive impact on the environment, it’s easy to see why investing in energy-efficient windows and doors is a wise choice.

Home Audits

One way to save money on energy bills and reduce your carbon footprint is by conducting a home energy audit. Not only does this help you identify areas where energy is being wasted, but it can also make you eligible for a tax credit of up to $150. To qualify, the audit must be performed by a certified professional.

Learn More About Your Options

Homeowners who choose to invest in energy-efficient equipment not only enjoy reduced energy costs, but they also have the chance to save even more with tax incentives. By partnering with Williams Comfort Air, homeowners can take full advantage of these tax incentives and enjoy the benefits of expert installation services for new heating, cooling, and water heating systems. With our team of trusted professionals, you can rest easy knowing you are making the right choice for your home and the environment.

Don’t wait any longer, start reaping the rewards of energy-efficient equipment today – schedule a free estimate on new equipment for your Indianapolis home!

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