- Island Ductless
Ductless Systems and the Inflation Reduction Act of 2022
Updated: Jan 10
The popularity of ductless heating and cooling systems continues to skyrocket as national attention highlights their energy efficiency and reduced impact on the environment. In fact, on August 16, 2022, President Joe Biden signed the landmark Inflation Reduction Act of 2022 into law, marking America’s largest investment in climate and energy throughout history.
Hope for the future The Inflation Reduction Act of 2022 intends to combat inflation by reducing the deficit, decreasing prescription drug prices, investing in domestic energy production, and encouraging clean energy. Although it is a 10-year plan with changes meant to happen over time, the new law’s funds will invest in green power, reduce emissions, increase environmental justice, and offer incentives like tax credits for builders and homeowners who utilize renewable energy. “Renewable energy” includes your ductless heat pump, of course!
Tax credits for new ductless system owners
If you purchased an ENERGY STAR-certified Air Source Ductless heating and cooling system in 2022 (all systems installed by IDHP meet the ENERGY STAR criteria), you’ll want to take advantage of your $300 available tax credit. ENERGY STAR-certified products save energy and money while protecting the environment, and the government wants to reward patrons for doing their part.
Good news for homeowners
If you plan to replace your furnace or air conditioner with a ductless system starting in 2023, enjoy a tax credit of 30% off the system installation cost, for up to $2,000 including the cost for electrical system upgrades needed to make your home heat pump ready. Additionally, state programs offer income-qualifying households rebates for heat pump purchases (up to $8,000) and up to $4,000 for needed electrical upgrades.
Great news for home builders The Inflation Reduction Act also rewards those who have acquired newly built energy efficient homes and units on or after January 1, 2023 through 2032. Per Section 45L Tax Credit for Energy Efficient New Homes, ENERGY STAR-certified single-family, and manufactured residences will receive a tax credit of $2,500, while multifamily homes will receive a tax credit of $500 or more if wage requirements are met.
Ductless systems not only provide paramount heating and cooling comfort, they’re also environmentally friendly and provide owners with tax savings. Please contact Island Ductless if you have further questions about your completed 2022 installation and how it might save you money, as well as inquiries about a future ductless system purchase. We look forward to a world where every home, business, and organization goes ductless!