HVAC and furnace tax credits in 2025 and 2026: 25C, 25D, 30C

Status on the date checked

25C energy efficient home improvement credit: Ended. Not allowed for property placed in service after December 31, 2025 (Pub. L. 119-21, sec. 70505; IRS FS-2025-05).
25D residential clean energy credit: Ended. Not allowed for expenditures made after December 31, 2025: when installation is completed, or for a new or rebuilt home, when you begin using it (sec. 70506; IRS FS-2025-05, Q7).
30C refueling property credit (home EV chargers): Ended. Not allowed for property placed in service after June 30, 2026 (Pub. L. 119-21, sec. 70504; IRS FS-2025-05).
DOE Home Energy Rebates (HOMES and HEEHR): Available in select states, according to DOE. Program Notices 26-1, 26-2 and 26-3 (effective May 29, 2026) changed the rules; HEEHR no longer funds replacing non-electric equipment.

A furnace, central air conditioner, heat pump or water heater installed in 2026 earns no 25C or 25D federal tax credit. Three federal tax credits for home energy equipment have ended. Public Law 119-21, approved July 4, 2025, moved their end dates forward (139 Stat. 251):

Credit	What it covered, per the IRS	Not allowed for	Pub. L. 119-21
25C, energy efficient home improvement credit	Items including heat pumps, heat pump water heaters, central air conditioners, natural gas, propane or oil water heaters, furnaces and hot water boilers	Property placed in service after December 31, 2025	Sec. 70505
25D, residential clean energy credit	Solar electric panels, solar water heaters, wind turbines, geothermal heat pumps, fuel cells, battery storage	Expenditures made after December 31, 2025	Sec. 70506
30C, alternative fuel vehicle refueling property credit	Property to recharge electric vehicles or to store or dispense clean-burning fuel, at a home or business	Property placed in service after June 30, 2026	Sec. 70504

All three dates have passed, so equipment installed now earns none of these credits. Equipment installed before the dates can still count, on the return for the year it was installed; the details are below. For rebates, DOE’s Home Energy Rebates program runs through states and is open in some of them (DOE Home Energy Rebates page).

Furnaces, AC, heat pumps and generators

Is there a tax credit for a new furnace, AC or heat pump in 2026?

Not from the federal 25C or 25D credits. The 25C credit covered these, and it is not allowed for property placed in service after December 31, 2025 (Pub. L. 119-21, sec. 70505; FS-2025-05, Q1). Buying the equipment in 2025 is not enough if it was installed in 2026: the IRS says to claim the credit “for the tax year when the property is installed, not merely purchased” (IRS 25C page). Geothermal heat pumps were on the 25D list, and 25D ended for installations completed after December 31, 2025 (IRS 25D page; FS-2025-05, Q7).

Is a new furnace tax deductible?

The federal energy tax benefit this page covers for a furnace in the home you live in was a credit, not a deduction: 26 U.S.C. 25C(a) allowed 30 percent of qualified costs “as a credit against the tax”, and the credit ended with 2025 installations. A new natural gas, propane or oil furnace or hot water boiler that met or exceeded the Consortium for Energy Efficiency (CEE) highest efficiency tier qualified for a credit of up to $600, and the cost could include installation labor (IRS 25C page). The home had to be an existing home in the United States, not a new one, and in most cases your main home. For 2025, the furnace also had to come from a qualified manufacturer, with its Qualified Manufacturer Identification Number (QMID) reported on the return (IRS 25C page). Oil furnaces and hot water boilers could also qualify through other efficiency criteria (IRS 25C page). The IRS also says: “You can’t claim the credit if you’re a landlord or other property owner who doesn’t live in the home.” (IRS 25C page). We did not review deductions for rental property or business use of a home.

What could HVAC equipment installed in 2025 get?

Up to $600 per item for a central air conditioner or a natural gas, propane or oil furnace, hot water boiler or water heater, inside a yearly limit of $1,200 that also covered exterior doors, windows, skylights, insulation and home energy audits. Heat pumps and heat pump water heaters had a separate limit of $2,000 per year. In each case the equipment had to meet the efficiency requirements listed under Limits that applied until the end dates. The IRS gives $3,200 as the most the credit could reach in one year (IRS 25C page).

Was there a tax credit for a whole-house generator?

We found none. The IRS 25C page lists central air conditioners, water heaters, furnaces and hot water boilers, heat pumps, heat pump water heaters, biomass stoves and boilers, exterior doors, windows, skylights, insulation and air sealing, home energy audits, and the electrical panels and circuits needed to support qualifying equipment. The IRS 25D page lists solar electric panels, solar water heaters, wind turbines, geothermal heat pumps, fuel cells and battery storage technology. Neither page names generators. A home battery with a capacity of at least 3 kilowatt hours was on the 25D list, if its installation was completed by December 31, 2025, or, in a newly built or rebuilt home, if you began using the home by then (IRS 25D page; FS-2025-05, Q7). To size a standby generator, see the generator size calculator.

I installed equipment in 2025 and did not claim the credit

The credit belongs on the 2025 return, filed with Form 5695. If that return is already filed, an amended return is the route; the time limits are under Claiming and carrying forward.

What the law says

Pub. L. 119-21 (H.R. 1, 139 Stat. 72) ends these credits in Title VII, Chapter 5, Subchapter A, “Termination of Green New Deal Subsidies” (139 Stat. 250). The law’s text does not use the name One Big Beautiful Bill. IRS fact sheet FS-2025-05 says the law is “commonly known as the One, Big, Beautiful Bill (OBBB)”, and an IRS newsroom page now uses the name Working Families Tax Cuts (IRS, Working Families Tax Cuts).

Sec. 70505 amends 25C so that the credit ends for property “placed in service after December 31, 2025”. In the 2024 edition of the U.S. Code, the end date was December 31, 2032 (26 U.S.C. 25C(i)).
Sec. 70506 amends 25D(h) so that the credit does not apply “with respect to any expenditures made after December 31, 2025”. The earlier text ended it for property placed in service after December 31, 2034 (26 U.S.C. 25D(h), 2024 edition). The same section struck the lower rates that had been scheduled for 2033 and 2034 (sec. 70506(b)).
Sec. 70504 replaces “December 31, 2032” with “June 30, 2026” in 30C(i).

The IRS restates the dates in FS-2025-05 (August 21, 2025), question 1:

25C: “The credit will not be allowed for any property placed in service after December 31, 2025.”
25D: “The credit will not be allowed for any expenditures made after December 31, 2025.”
30C: “The credit will not be allowed for any property placed in service after June 30, 2026.”

The IRS adds that because these FAQs have not been published in the Internal Revenue Bulletin, they “will not be relied on or used by the IRS to resolve a case”, and that if an FAQ turns out to be inaccurate for a particular case, “the law will control the taxpayer’s tax liability”. In the same paragraph it says that “a taxpayer who reasonably and in good faith relies on these FAQs will not be subject to a penalty that provides a reasonable cause standard for relief, including a negligence penalty or other accuracy-related penalty, to the extent that reliance results in an underpayment of tax” (FS-2025-05).

Equipment installed before the deadline

25D counts the date installation was completed or the home was first used

Under 26 U.S.C. 25D(e)(8)(A), “an expenditure with respect to an item shall be treated as made when the original installation of the item is completed.” The IRS applies this to the end date: if you paid on or before December 31, 2025 but installation was completed after that date, the expenditure counts as made after December 31, 2025, and the credit cannot be claimed (FS-2025-05, Q7).

A second rule covers new construction. For an expenditure “made in connection with the construction or reconstruction of a structure”, section 25D(e)(8)(B) treats it as made “when the original use of the constructed or reconstructed structure by the taxpayer begins”. If you began using a newly built or rebuilt home after December 31, 2025, the solar or other 25D property in it does not qualify, whenever it was paid for (FS-2025-05, Q7).

25C uses “placed in service”

The IRS 25C page says: “You must claim the credit for the tax year when the property is installed, not merely purchased.” We found no IRS definition of “placed in service” for 25C in the documents we read, so do not assume that the 25D installation rule carries over to 25C.

Claiming and carrying forward

Credits for 2025 property belong on the 2025 return. For 25D, the IRS says “taxpayers that incur qualifying expenses in taxable year 2025 may claim the credit on their tax returns filed for taxable year 2025” (FS-2025-01). Both credits are claimed on Form 5695 (Instructions for Form 5695 (2025)).

An unused 25D credit can be carried forward and applied to tax in later years (IRS 25D page); the 2025 Form 5695 instructions provide for carrying the unused portion to 2026. A 25C credit cannot be carried forward: “if a taxpayer does not have sufficient tax liability to claim all or a portion of the credit for a taxable year, the unused amount of the credit may never be claimed” (FS-2025-01). The IRS 25C page says the same: “You can’t apply any excess credit to future tax years.”

If you qualified for an earlier year and did not claim the credit, the IRS says: “Generally, to claim a refund, a taxpayer must file an amended return within 3 years after the date the original return was filed, or 2 years after the date the tax was paid, whichever is later” (FS-2025-01).

Limits that applied until the end dates

25C: the IRS page gives two yearly maximums, “$1,200 for energy efficient property costs and certain energy efficient home improvements”, with separate limits on exterior doors, windows and skylights, and home energy audits, and “$2,000 per year for qualified heat pumps, water heaters, biomass stoves or biomass boilers”. Central air conditioners, natural gas, propane or oil water heaters, and natural gas, propane or oil furnaces and hot water boilers qualified for up to $600 per item. The equipment had to meet or exceed the Consortium for Energy Efficiency (CEE) highest efficiency tier, not including any advanced tier, in effect at the beginning of the year it was installed; oil furnaces and hot water boilers could also qualify through other efficiency criteria. Electrical components needed to support this equipment, including panelboards, sub-panelboards, branch circuits and feeders, qualified for up to $600 per item if they met the National Electrical Code and had a capacity of 200 amps or more. Electric or natural gas heat pumps and heat pump water heaters fell under the $2,000 limit and also had to meet the CEE highest efficiency tier; biomass stoves and boilers needed a thermal efficiency rating of at least 75 percent. The credit equaled 30 percent of qualified expenses, and the IRS gives $3,200 as the most it could reach in one year (IRS 25C page).
25D: 30 percent of the cost of new qualified clean energy property installed from 2022 through December 31, 2025 (IRS 25D page).
30C, for individuals: 30 percent of the cost, up to $1,000 per item (each charging port, fuel dispenser or storage property), for property bought and placed in service at your main home from January 1, 2023 to June 30, 2026. The property had to be in a low-income community census tract or a non-urban census tract (IRS 30C page).

IRS pages that differ from the law

The 25C page says the credit is allowed for property placed in service “before December 31, 2025”, and elsewhere for improvements made “through December 31, 2025”. The law and FS-2025-05 bar property placed in service after December 31, 2025, which leaves December 31 itself inside the credit period.
The 25D page still says you can claim the credit “until the credit begins to phase out in 2033”. The law struck the 2033 and 2034 rates, and the same page’s first lines under “How it works” give the December 31, 2025 end.
FS-2025-01, from January 2025, says the 25C credit is allowed for property placed in service “before Jan. 1, 2033”. It predates the law; FS-2025-05 has the current dates.
The 2025 Form 5695 instructions say the 25C credit cannot be claimed for “expenditures or property placed in service after December 31, 2025”. For 25C, the law uses only “placed in service”.

Home Energy Rebates: HOMES and HEEHR

DOE’s Home Energy Rebates program has two parts: Home Owner Managing Energy Savings (HOMES) rebates and the High-Efficiency Electric Home Rebate (HEEHR) program (DOE Home Energy Rebates page). HEEHR is the program previously called Home Electrification and Appliance Rebates (HEAR); DOE changed the name “to align with the statutory name in section 50122 of the IRA” (Program Notice 26-2, sec. 3.1).

DOE’s program page says: “Home Energy Rebates are now available in select states. Additional details on active state, territory or Tribal rebate programs are coming soon. Contact your State or Territory Energy Office for more information on the status and eligibility requirements.” The page has no list of states. It says households can save up to $8,000 through HOMES, “based on modeled energy savings levels with a minimum savings of 20%”, with a note that grantees may increase rebates for households with income below 80 percent of the area median, and up to $14,000 through HEEHR (DOE Home Energy Rebates page, HTTP Last-Modified October 12, 2026).

Program Notices 26-1 (HOMES), 26-2 (HEEHR for states and territories) and 26-3 (HEEHR for Tribes) all took effect May 29, 2026. For HEEHR, Notice 26-2 does the following (sec. 3.3):

It removes rebates for fuel switching, meaning the replacement of non-electric appliances, and allows rebates for upgrading HVAC and appliances “only from existing electric equipment to more efficient electric equipment”. HVAC and electric appliances in new construction remain eligible.
It requires homes to use rebates for insulation and air sealing before heating and cooling upgrades, unless the home is already insulated and sealed to “a DOE approved, state-specified level”.
It allows a home to keep its existing fossil-fuel HVAC system when a heat pump is installed, even if the heat pump will not be the main source of heating and cooling.

Programs already running had three months from publication of the notices to make the changes, unless DOE approves more time (Program Notice 26-1, sec. 3; Program Notice 26-2, sec. 3). Under Notice 26-2, HEEHR rebate reservations already approved under the previous guidance may be honored, but “no new rebate reservations are allowed or can be approved for projects that do not conform to the new program strategy” (sec. 3).

What this means for you

A heat pump, central air conditioner, water heater, furnace, solar array, battery or EV charger installed today earns no 25C, 25D or 30C credit.
If it was installed in 2025, check the year carefully. For 25C, the property must have been placed in service by December 31, 2025. For 25D, installation must have been completed by December 31, 2025, or, in a newly built or rebuilt home, you must have begun using the home by then; paying earlier does not help. Claim the credit on the 2025 return with Form 5695.
If you claimed 25D and could not use all of it, the unused part carries forward. Unused 25C credit is lost.
If you missed a credit you qualified for in an earlier year, the amended return limits above apply.
A home EV charger placed in service at your main home by June 30, 2026 may qualify under 30C if it is in an eligible census tract (IRS 30C page).
For rebates, contact your state or territory energy office and ask whether a HOMES or HEEHR program is open and what it covers under the May 2026 rules.
This page describes the law and IRS guidance. For your own return, use the Form 5695 instructions or a tax professional.

What we could not confirm

The amended text of 26 U.S.C. 25C, 25D and 30C. On October 13, 2026 the section pages of uscode.house.gov returned “Page Not Found” while the site runs in a temporary format. We read the 2024 edition on govinfo and the amending sections of Pub. L. 119-21, and did not assemble the amended text ourselves.
A section-letter mismatch. Sec. 70505(a) amends “Section 25C(h)”, but in the 2024 edition of the Code, 25C(h) is the product identification number requirement and the end date is in 25C(i). The IRS reads the change as ending the credit for property placed in service after December 31, 2025 (FS-2025-05, Q1), and this page follows the IRS.
Congress.gov pages for the law. They did not load from our system; the law text comes from govinfo.
A definition of “placed in service” for 25C. The IRS documents we read give none.
Which states have open HOMES or HEEHR programs. DOE’s page gives no list. The page also prints a stray date (“May 11, 2019”) with no context, so we date it by its HTTP header, October 12, 2026.
Treasury regulations for 25C and 25D, IRS guidance on qualified manufacturers and product identification numbers, and the Form 5695 PDF. We did not review them, so this page does not cover item-by-item eligibility beyond the IRS pages quoted, or any 25C limits other than those above.