The 25C Federal Tax Credit is part of the Inflation Reduction Act, designed to help homeowners save money when upgrading to energy-efficient heating and cooling systems. Eligible Seattle homeowners can claim a tax credit on qualifying HVAC installations, lowering upfront costs while improving energy savings.

Homeowners may be able to claim up to 30% of installation costs, with a maximum of $600–$2,000 depending on the equipment. The exact savings depend on the type of system installed (e.g., heat pumps, central air, furnaces, or insulation upgrades).

Qualifying systems include:

• High-efficiency heat pumps

• Energy Star–rated air conditioners

• High-efficiency furnaces and boilers

• Certain insulation and ventilation upgrades

Seattle residents benefit most from heat pumps, since they provide both heating and cooling while reducing energy use.

Yes. Heat pumps are one of the biggest tax credit opportunities, with up to $2,000 available. In Seattle’s moderate climate, heat pumps work efficiently year-round, making them a cost-effective upgrade.

Any primary residence homeowner in the U.S., including Washington State residents, can claim the credit. Rental properties and new construction do not typically qualify, but Seattle homeowners upgrading existing systems are eligible.

After installing a qualifying HVAC system, homeowners can file IRS Form 5695 (Residential Energy Credits) when submitting their annual tax return. Always keep receipts, manufacturer certifications, and installation records for verification.

Yes. Seattle homeowners can stack the 25C Tax Credit with local rebates, such as those from Seattle City Light, Puget Sound Energy (PSE), and state efficiency programs, maximizing total savings.

The 25C Federal Tax Credit ends on December 31, 2025. Homeowners must have their qualifying system installed by or before that date to be eligible—no exceptions. Waiting beyond the deadline means missing out on the incentive entirely.

By switching to high-efficiency systems, homeowners can cut energy use by 20–40%, reducing both monthly utility bills and long-term maintenance costs. In Seattle, where electricity is clean and affordable, the tax credit makes heat pumps and efficient systems an even better investment.

Because the credit expires December 31, 2025, homeowners who wait risk losing thousands in savings. Acting now allows you to take advantage of both federal tax credits and local rebates, lock in today’s equipment prices, and enjoy lower utility bills well before the deadline.