Technology

Heat Pump Tax Credit 2026: Federal + State Stacking Guide

The federal 25C credit pays 30% of heat pump cost up to $2,000 per year through 2032, while the IRA HEEHRA rebate adds up to $8,000 for income-qualified households (≤150% Area Median Income). State programs in Massachusetts (Mass Save up to $10,000), New York (NYSERDA Clean Heat $1,500–$5,000 per ton), Maine (Efficiency Maine $8,000+), and Oregon (Energy Trust $1,800) deliver some of the strongest state-level stacks. The federal 25C and HEEHRA do NOT stack on the same equipment — choose the higher. Heat pumps must meet the highest CEE efficiency tier and equipment must include a manufacturer PIN starting tax year 2025.

Federal 25C Heat Pump Mechanics

30% of heat pump cost up to $2,000 per year. Cap resets each January. Equipment must meet highest CEE tier. Starting tax year 2025, manufacturer PIN required. Non-refundable, no carryforward.

IRA HEEHRA Heat Pump Rebate

Up to $8,000 point-of-sale rebate for heat pumps under HEEHRA. Income-qualified: ≤80% AMI = 100% cost coverage; 80–150% AMI = 50% cost coverage. State energy office administered.

Top State Heat Pump Programs

Mass Save (MA): up to $10,000 whole-home. NYSERDA Clean Heat (NY): $1,500–$5,000 per ton. Efficiency Maine: $8,000+ for cold-climate ASHP. Energy Trust of Oregon: $1,800. Mass Save also covers HPWH at $750 and ground-source at $4,500–$6,500.

Equipment Requirements

Air-source heat pumps must meet highest CEE tier and be on NEEP Cold Climate ASHP list (for northern climates). HPWH must be ENERGY STAR. Ground-source must meet ENERGY STAR Geothermal specifications.

Sizing and Capacity Notes

Heat pump rebate is typically per-ton (12,000 BTU/hr cooling). A 3-ton whole-home unit qualifies for 3× the per-ton rebate. Whole-home full-displacement installs qualify for higher tiers in MA and NY than partial-displacement.

Frequently asked questions

25C vs HEEHRA — which is better? +

HEEHRA wins for income-qualified households (≤150% AMI) — up to $8,000 vs $2,000. 25C wins for higher-income because HEEHRA does not apply.

Cold-climate heat pump in northern states? +

Required for state rebates in MA, NY, ME, MN, VT, NH. Check NEEP Cold Climate ASHP list. HSPF2 ratings of 8+ are typical for qualifying equipment.

Heat pump water heater stack with whole-home heat pump? +

Yes. Both qualify under 25C $2,000 cap (combined). Both qualify under HEEHRA caps (separately — HPWH up to $1,750, heat pump up to $8,000).