When it’s time to upgrade your home service equipment, take advantage of the tax incentives available to you. At Rudd Plumbing Heating and Air, we provide information on a host of tax incentives and rebates to our customers because we believe you deserve to enjoy substantial savings and enhanced home comfort!
What’s the Difference Between Rebates and Tax Credits?
You might be wondering what rebates and tax credits you can expect when working with Rudd Plumbing Heating and Air for an HVAC or water heater installation. First, let’s clarify the difference between the two. Tax incentives or credits are a reduction in the amount of income tax that you owe and can be claimed through federal and state governments. On the other hand, rebates are typically offered through private organizations and government programs or agencies, which provide an upfront discount at the time of purchase, depending on different factors.
What Federal Rebates are Available?
ENERGY STAR
The DOE sets mandatory energy standards, while the EPA’s standards are voluntary and focus on environmental impact. Products that meet the EPA’s criteria receive the ENERGY STAR certification and are often required to qualify for federal tax credits and rebates.
Inflation Reduction Act
For a broader range of improvements, the HOMES rebate, also part of the IRA, covers enhancements like insulation or electrical upgrades. Local utility programs, like Berkeley Electric Cooperative, may also provide thermostat rebates that could cover the entire cost. Check if your utility company offers a demand response program, as choosing a compatible thermostat could earn you additional benefits. We’ll provide you with more information on utility company rebates below.
Heating and Cooling Rebates That You Could Qualify for
Dominion customers can receive rebates and reduced costs by purchasing and installing qualified ENERGY STAR equipment. This includes qualified central air conditioners and heat pumps, replacing electric furnaces with an ENERGY STAR-qualified heat pump, making ductwork improvements in your home, or installing a new ENERGY STAR-certified heat pump water heater. Find out a bit more information about these rebates and rebates from Berkeley Electric Cooperative below.
Dominion Ductwork Rebate
Do you have ductwork in your home? You could be eligible for a ductwork improvement rebate from Dominion Energy when you make improvements to your ductwork that increase energy efficiency within your home. Available incentives include a rebate of $300 for duct sealing and $300 for duct insulation, which include complete ductwork replacement. The benefits of this include sealing and insulating your existing ductwork or replacing your ductwork to reduce energy use and improve the comfort of your home.
To be eligible for this rebate, you need to have a licensed contractor install your ductwork and submit an application and detailed invoice to Dominion within 90 days of installation. Certain eligibility constraints are in place, so be sure to confer with Rudd Plumbing Heating and Air and the rebate application.
Dominion Natural Gas Water Heater Rebate
Dominion Energy also offers rebates of up to $350 when you purchase and install an ENERGY STAR-certified natural gas water heater. These independently certified water heaters help to reduce energy consumption and save you money over time. Available rebates include both tank-style and tankless gas-fired water heaters, and the rebates can vary depending on the Uniform Energy Factor, which measures energy performance. The higher the UEF value, the more efficient the water heater. Certain eligibility requirements apply, such as having a licensed plumbing contractor install the water heater. See other requirements from Dominion Energy on this natural gas water heater rebate.
Dominion HVAC Rebate
Homeowners can also save money through rebates for heating and cooling system replacements from Dominion Energy. With ENERGY STAR-qualified equipment, you could receive rebates from $400 to $500 toward the cost of purchasing and installing this qualified equipment, which includes both central air conditioners and heat pumps.
What benefits can you expect when you replace older, less energy-efficient equipment with ENERGY STAR-qualified equipment? You’ll gain lower energy costs, improved home comfort, reduced energy use, and, of course, cash back from a rebate like this. Certain eligibility requirements are in place, so be sure to speak with a Rudd Plumbing Heating and Air technician and visit Dominion Energy’s application for more information.
Berkeley Electric Cooperative Dual Fuel HVAC Rebate
This rebate is available for both existing residential gas unit replacements and newly constructed homes. Certain eligibility requirements and restrictions apply, so be sure to verify the details with the BEC application. Rudd Plumbing Heating and Air technicians and team members will be sure to provide you with direction and assistance.
Santee Cooper Home Rebate Programs
To qualify for Santee Cooper’s heat pump rebate and duct replacement rebate, you’ll need a Santee Cooper Trade Ally to install your new heat pump or ductwork. Rudd Plumbing Heating and Air is a Santee Cooper Trade Ally, so we can easily help you with these installations and replacements and make sure you get the rebate you qualify for. Heat pump rebates range from $40 per half-ton to $700 per installed system. Duct replacement rebates are available for single-family and multi-family homes, with rebates up to $500.
Santee Cooper also offers rebates for smart thermostat installation and heat pump water heaters. For a rebate on smart thermostat installation, customers will need to choose one from the utility provider’s smart thermostat prequalified list, which our technicians can help you navigate. Rebate amounts range from $30 to $50, depending on the size of the home. And don’t forget about the available heat pump water heater rebate! This energy-efficient choice will garner customers a rebate of $400 when they purchase a qualifying heat pump water heater and have it installed by a South Carolina licensed plumber.
The Locally Owned Home Services Company You Can Trust
At Rudd Plumbing Heating and Air, we want to ensure you get the most out of your heating and cooling equipment. We provide expert heating and air conditioning installation, with highly trained technicians and plumbers on staff. We are a proud member of the South Carolina Association of Licensed Trades (SCALT) and one of a few select contractors for the Berkeley Electric Home Advantage Loan program.
Our team at Rudd Plumbing Heating and Air can tell you more about these rebate programs and tax incentives and help determine your eligibility. Terms and conditions are subject to change. Contact our highly skilled team today!
Carrier
2025 CEE Criteria Update – IRA and 25C Implications
In 2022, the expired Energy Efficient Home Improvement Credit – previously known as the Nonbusiness Energy Property Credit and otherwise known as Section 25C – was reintroduced and extended to the end of 2022 through the Inflation Reduction Act of 2022 (IRA). At the same time, 25C was extended for eligible investments made from 2023, through 2032. During the introduction of 25C, efficiency criteria was set forth by the Consortium for Energy Efficiency (CEE).
As of October 10th, 2024, the CEE has published new criteria that HVAC systems need to meet to be eligible for IRA/25C tax credits starting January 1st, 2025. There will be additional updates starting January 1st, 2026.
For this bulletin, we will only be focused on the changes taking place for 2025. Link to the updated CEE specification sheet can be found here: CEE HVAC Specification
Introduction to IRA and 25C
For installations of eligible equipment occurring after January 1, 2023, homeowners may receive a nonrefundable credit against their taxes for an amount equal to the sum of:
- 30% of the total installation costs of eligible equipment up to $1,200 per taxable year.
- The credit for eligible heat pump installation costs is capped at $2,000; these costs are considered separate from the $1,200 annual limit.
- This means, the installation of an approved heat pump along with other qualifying expenditures is capped at a total of $3,200 per taxable year.
25C is a nonrefundable tax credit. Please have your consumers consult with their tax professional for further details.
A homeowner can claim the § 25C credit only for qualifying expenditures incurred for an existing home or for an addition or renovation to an existing home. This cannot be claimed on a new construction home. Labor costs may be included while calculating the § 25C credit for the onsite preparation, assembly, or original installation. In contrast, a homeowner may not include the labor costs for qualified energy efficient building envelope components.
The credit for qualifying equipment is subject to a cap of $600 for Central Air Conditioners, $600 for Furnaces and $2,000 for Heat Pumps. The (IRA) requires 25C to align with the equipment specifications determined by the Consortium for Energy Efficiency (CEE) Product Bulletin ©2024 Carrier – Confidential & Proprietary – Not For Further Distribution
Summary of Changes – January 1st, 2025
For installations of equipment occurring after January 1st, 2025, required efficiency criteria will be updated.
This document aims to help show the changes in criteria that will be taking effect at the start of 2025. Below is a summary of the changes:
- Split Ducted Heat Pumps
- Removal of North and South designations
- Two criteria options, either option can be used for 25C eligibility
- Higher SEER2 requirements
- Removal of Heating Capacity at 17F / 47F option
- Ductless (non-ducted) Heat Pumps
- Removal of dedicated criteria requirements, merged with Ducted Heat Pumps
- Packaged (SPP) Heat Pumps
- Removal of North and South designations
- Will only have one criteria path
- Split and Packaged (SPP) Air Conditioners
- Higher SEER2 requirements
- All systems must meet the highest CEE tier (excluding advanced tier) to be eligible for 25C
Carrier will be updating marketing literature, sales tools, and ratings sites in the coming weeks. Examples of
these updates will be marketing literature with eligible products and MyCarrierRatings filter updates.
In the following sections, tables will list the changes for 2025 25C criteria based on the latest specifications
from CEE.
Split System Heat Pumps
Heat Pump systems will have the largest change in criteria requirements compared to where they are today.
This is due in part to the removal of the North and South designations and combining ducted and non-ducted
into one category.
Additionally, COP and Heating Capacity will be required for both pathways. These metrics will both be
calculated at 5F. Having calculations only measured at 5F will differ from the North today where Heating
Capacities had the option of being calculated at 17F or 5F. For customers in the South, the COP and Heating
Capacity requirement will be new for 25C rebates. For both options, SEER2 is going to be bumped to 16.0,
compared to the 15.2 for both regions today.
Installations of Split Heat Pumps on or after January 1st, 2025 must meet the criteria below for IRA tax credits.
Split System Air Conditioners
Air Conditioner splits will maintain one pathway across the US. The only change will be an increase in SEER2.
Installations on or after January 1st, 2025 must meet the criteria below for IRA tax credits.
Small Packaged Air Conditioners (SPP)
SPP Air Conditioners will follow a very similar pattern to Split ACs. There will only be one path, and the change
is focused on increasing SEER2.
Installations of Packaged ACs on or after January 1st, 2025, must meet the criteria below for IRA tax credits.
Small Packaged Heat Pumps (SPP)
SPP Heat Pumps will be seeing the removal of North and South region designations and will only have one path
going forward.
Installations of Packaged HPs on or after January 1st, 2025, must meet the criteria below for IRA tax credits.
Resources
Though we are still in the process of updating product literature and brochures to reflect the changes for 2025,
there are still several resources available on the Inflation Reduction Act, IRS, 25C and CEE. Below are a few
links to resources relevant to the Inflation Reduction Act.
- “CEE 2025 HVAC Specification Sheet” – Spec sheet for 25C CEE criteria beginning January 1st, 2025
- “AHRI 1380” – AHRI 1380 Test Procedure, taking effect January 1st, 2026 for Variable Speed Systems
- “CAPITALIZING ON CAPITOL HILL: TURNING THE INFLATION REDUCTION ACT INTO SALES” – Brochure
- “Inflation Reduction Act Frequently Asked Questions” – FAQ Document
- “IRS Fact Sheet” – IRS FAQ Document on Energy Efficiency Related Tax Issues
