Form 5695 for 2025 and 2026: QMID, lines, carryforward

Status on the date checked

Form 5695 (2025)

Current form for tax year 2025: form posted November 21, 2025, instructions posted January 29, 2026. Part II (25C) needs the 4-character QMID for each item of specified property placed in service in 2025.

Form 5695 (2026)

Draft only as of October 26, 2026, titled "Carryforward of Residential Energy Credit" (draft form posted May 26, 2026; draft instructions posted September 1, 2026). The IRS says not to file draft forms.

QMID requirement (25C, 2025 property)

A 4-character code for each item except insulation and air sealing; line 26 (home energy audits) has no QMID field. The IRS list of qualified manufacturers gives names and agreement dates, not codes.

Heat pumps, heat pump water heaters, central air conditioners, and gas, propane or oil furnaces, boilers and water heaters installed in 2025 (for 25C, placed in service in 2025) are claimed in Part II of the 2025 Form 5695 (the 25C credit), with a four-character QMID for each item (2025 Instructions for Form 5695, p. 1; insulation, air sealing and home energy audits have none). Solar panels, battery storage and geothermal heat pumps go in Part I (the 25D credit). For 2026 the IRS has only a draft Form 5695, titled “Carryforward of Residential Energy Credit”, for 25D credit left over from 2025: neither credit is allowed for equipment installed in 2026 (FS-2025-05, Q1; see 25C, 25D and 30C tax credits).

This page describes IRS forms and guidance as of October 26, 2026 and is not tax advice; for your own return, use the IRS instructions or a tax professional.

Which form for your situation

The due date for 2025 returns was April 15, 2026 (IRS, When to file), and an extension gave until October 15 (IRS, Extension of time to file). Both dates have passed. A 2025 return filed without the credit is corrected with Form 1040-X; a 2025 return not yet filed is filed late, with the same 2025 Form 5695.

Your situation	Form and tax year	What you need	Details
Equipment installed in 2025; 2025 return not filed yet	2025 Form 5695, attached to your 2025 Form 1040	Cost and QMID of each Part II item; the manufacturer’s certification, kept on file	Part II lines, late return
Equipment installed in 2025; 2025 return filed without the credit	Form 1040-X for 2025, with the 2025 Form 5695	The same, plus a complete amended Form 1040 with your changes	Amended return
25D credit left over after 2025: an amount on line 16 of your 2025 Form 5695	2026 Form 5695. On October 26, 2026 the IRS has posted only a draft	The line 16 amount	The 2026 form
25D credit left over from 2024	2025 Form 5695, line 12	Line 16 of your 2024 Form 5695	Limits
Equipment installed in 2026	No 25C or 25D credit	Nothing to claim on Form 5695	25C, 25D and 30C credits
Home EV charger placed in service January 1 to June 30, 2026	Form 8911, not Form 5695	The 30C conditions, summarized on our credits page	30C limits and conditions
A CP12 notice or Letter 12C about your 2025 return	Answer the letter as it instructs	The letter and your records	IRS letters

For the EV charger credit, the IRS says to attach Form 8911 to your tax return; the credit covers property placed in service at your main home from January 1, 2023 to June 30, 2026 (IRS 30C page). The current Form 8911 is the December 2025 revision (Form 8911, p. 1), and the IRS draft list for Form 8911 shows no 2026 revision (IRS Draft Tax Forms, search 8911).

Form 5695 (2025), Part II: which line for your equipment

Part II has two sections. Section A, lines 17 to 20, is for insulation, exterior doors, windows and skylights. Section B, lines 21 to 29, is for the equipment below; lines 27, 28 and 30 to 32 add up both sections. Each line gives 30 percent of cost, up to the cap printed on the form (2025 Form 5695, pp. 2–4).

Equipment	Lines	Cap	QMID entered on	Requirement in the instructions
Central air conditioner	22a–22d	$600 (22d)	22a, for the most expensive unit	Highest efficiency tier of the Consortium for Energy Efficiency (CEE) in effect at the beginning of the year it was placed in service (2025 Instructions for Form 5695, p. 6)
Natural gas, propane or oil water heater	23a–23d	$600 (23d)	23a, for the two most expensive	CEE highest efficiency tier (2025 Instructions for Form 5695, p. 6)
Natural gas, propane or oil furnace or hot water boiler	24a–24d	$600 (24d)	24a, for the most expensive	CEE highest efficiency tier; oil furnaces and boilers also need the 2021 Energy Star criteria and a rating for fuel blends that are at least 20% eligible fuel by volume (2025 Instructions for Form 5695, p. 6)
Panelboard, subpanelboard, branch circuit or feeder (“enabling property”)	25a–25e	$600 (25e)	25d	Installed with qualifying equipment, “in a manner consistent with the National Electric Code”, with a load capacity of at least 200 amps (2025 Instructions for Form 5695, p. 7)
Home energy audit	26a–26c	$150 (26c)	No QMID field	Inspection of your main home and a written report by, or supervised by, a Qualified Home Energy Auditor (2025 Instructions for Form 5695, p. 7)
Electric or natural gas heat pump	29a–29b	$2,000 for lines 29a to 29f together (29h)	29a, for the most expensive	CEE highest efficiency tier (2025 Instructions for Form 5695, p. 7)
Electric or natural gas heat pump water heater	29c–29d	Within the same $2,000	29c, for the most expensive	CEE highest efficiency tier (2025 Instructions for Form 5695, p. 7)
Biomass stove or boiler	29e–29f	Within the same $2,000	29e, for the most expensive	Thermal efficiency rating of at least 75%, measured by the higher heating value of the fuel (2025 Instructions for Form 5695, p. 7)
Insulation and air sealing, exterior doors, windows and skylights (Section A)	18a–20d	$1,200 for insulation; $250 for one door and $500 for all doors; $600 for windows and skylights	Doors on 19b and 19d, windows on 20a; none for insulation	Main home; IECC criteria for insulation, Energy Star for doors and windows; installation labor not included (2025 Instructions for Form 5695, pp. 3, 5–6)

In Section B, the first line of each group (22a, 23a, 24a, 29a, 29c, 29e) takes the QMID and cost of the most expensive item; line 23a takes the two most expensive water heaters. Other items go on the next line (22b, 23b, 24b, 29b, 29d, 29f) as one amount, and then you “attach a statement to your return listing the QMID and cost of each item” on that line (2025 Instructions for Form 5695, pp. 6–7).

The form has no line named for ductless mini-splits or for tankless water heaters. By our reading, a ductless mini-split heat pump is an electric heat pump for line 29a, and a gas tankless water heater is a natural gas or propane water heater for line 23a; the IRS documents we used do not use either term. A. O. Smith publishes its code on a page about the credit for gas tankless water heaters (A. O. Smith, gas tankless page). For a heat pump with an indoor and an outdoor unit, the IRS ties the identification number to the outdoor unit (IRS FAQ, PIN requirements, Q2; Rev. Proc. 2024-31, sec. 5.05).

Line 25 has its own conditions. Panel or circuit work counts only if it was installed “to enable the installation and use of” qualifying equipment and both were installed in 2025; if they were installed in consecutive tax years, you can treat both as installed in the later year (2025 Instructions for Form 5695, p. 6). Line 25b takes a letter for the equipment the work enabled: A for windows and skylights, B for central air conditioners, C for water heaters on line 23a, D for furnaces and boilers, E for heat pumps, F for heat pump water heaters, G for biomass stoves or boilers (2025 Instructions for Form 5695, pp. 6–7). For enabling property the IRS accepts the manufacturer’s 4-character QM Code whatever the year (IRS FAQ, PIN requirements, Q1).

Lines 17a to 17e open Section A. They ask whether the improvements are in or on your main home in the United States, whether you are their original user, whether the components can be expected to stay in use for at least 5 years, the address of the main home, and whether any improvement was related to building that home. A “Yes” on 17e means skipping lines 18a to 20d (2025 Form 5695, p. 2; 2025 Instructions for Form 5695, p. 5). Section B starts with lines 21a and 21b; if either answer is “No”, “you cannot claim the credit for your residential energy property costs. Skip lines 22 through 25 and line 29. Go to line 26.” (2025 Form 5695, p. 3).

What counts as cost

Section B lines include “labor costs for onsite preparation, assembly, and original installation” (2025 Form 5695, p. 3, line 22; 2025 Instructions for Form 5695, p. 6). Section A lines do not: the instructions say not to include those amounts on lines 18a, 19a, 19d, 19e, 20a and 20b (2025 Instructions for Form 5695, p. 5). Costs count as paid “when the original installation of the item is completed” (2025 Instructions for Form 5695, p. 1).

Subtract subsidies and rebates before you multiply by 30 percent:

• A public utility subsidy that was not included in your gross income reduces the cost by its amount. “This rule also applies if a third party (such as a contractor) receives the subsidy on your behalf” (2025 Instructions for Form 5695, p. 2).
• A rebate is subtracted when it is based on the cost of the property, comes from someone connected to the sale, such as the manufacturer, distributor, seller or installer, and is not payment for services you provide (IRS 25C page).
• State energy efficiency incentives “are generally not subtracted from qualified costs unless they qualify as a rebate or purchase-price adjustment under federal income tax law” (IRS 25C page). A rebate under the DOE Home Energy Rebate programs “will be treated as a purchase price adjustment” (Announcement 2024-19), and a taxpayer who receives one “must reduce the amount of qualified expenditures used to calculate the § 25C credit by the amount of the rebate” (Announcement 2024-19).
• Interest and other financing costs, origination fees and extended warranties are not eligible (IRS FAQ, General questions, Q8). Amounts from subsidized energy financing under a federal, state or local program can’t be used either (2025 Instructions for Form 5695, p. 3).

If less than 80 percent of an item’s use is nonbusiness, only the nonbusiness share of its cost counts (2025 Instructions for Form 5695, p. 1). The IRS 25C page states the same rule from the other side: business use up to 20 percent gets the full credit.

Which home qualifies

The IRS FAQ pages cited here restate Fact Sheet FS-2025-01 of January 2025, written before Pub. L. 119-21; this page uses them for eligibility and recordkeeping rules, not for end dates.

Part II “is only available for existing homes” (2025 Instructions for Form 5695, p. 1). Expenses related to building a new home are out, “even if the improvements were made after you moved into the home”; additions to and renovations of an existing home are in (2025 Form 5695, p. 2; 2025 Instructions for Form 5695, p. 5).

The IRS FAQ treats the two sections differently. For insulation, doors and windows, the home must be in the United States and “owned and used by the taxpayer as the taxpayer’s principal residence”, so a renter does not qualify. For heat pumps, central air conditioners, water heaters, furnaces, boilers, biomass equipment and panel work, the home must be in the United States and “used as a residence by the taxpayer”, and “the taxpayer may rent the home in which such property is installed, and such property may be installed in the taxpayer’s second home” (IRS FAQ, Qualifying residence, Q1). Line 21a asks the same question, and line 21c takes the address of each home where you installed such equipment (2025 Form 5695, p. 3).

The IRS 25C page is narrower: “In most cases, the home must be your primary residence (where you live the majority of the year).” Both exclude landlords who do not live in the home; in the FAQ’s words, “landlords can never use the credit for homes they rent out but do not use as a residence themselves” (IRS FAQ, Qualifying residence, Q1; IRS 25C page).

Your main home “is generally the home where you live most of the time”, and “You may only have one main home at a time” (2025 Instructions for Form 5695, p. 1).

Part I: geothermal heat pumps, batteries and solar

Part I is the 25D credit: solar electric property on line 1, solar water heating on line 2, small wind on line 3, geothermal heat pumps on line 4, battery storage with a capacity of at least 3 kilowatt hours on lines 5a and 5b, and fuel cells on lines 7a to 11. The credit is 30 percent of the total on line 6a (2025 Form 5695, p. 1). Geothermal heat pumps must meet the Energy Star requirements in effect at the time of purchase, the home “doesn’t have to be your main home”, and costs include labor and the piping or wiring that connects the system to the home (2025 Instructions for Form 5695, p. 2). Part I has no QMID fields (our check of the form).

The QMID

For 25C property placed in service in 2025, “you must include the four-character alphanumeric unique qualified manufacturer identification number (QMID) for each item” (2025 Instructions for Form 5695, p. 1). The form asks for it on lines 19b, 19d, 20a, 22a, 23a, 24a, 25d, 29a, 29c and 29e (2025 Form 5695, pp. 2–4). Without it the item does not count: “To qualify for the energy efficient home improvement credit for specified property, you must provide a valid QMID for each item” (2025 Instructions for Form 5695, p. 5). The IRS 25C page says that no credit is allowed unless the item “was produced by a qualified manufacturer and the taxpayer reports the Qualified Manufacturer Identification Number (QMID) for the item on their tax return”.

The IRS 25C page says insulation and air sealing are the only types of qualifying property that do not have to meet the qualified manufacturer and PIN requirements. The IRS FAQ adds that no PIN is required for a home energy audit and that enabling property may use the QM Code in lieu of a PIN (IRS FAQ, PIN requirements, Q1 and Q2). Line 26, home energy audits, has no QMID field (2025 Form 5695, p. 4).

QMID, QM Code and PIN

The IRS uses two names for the four-character code. The form and its instructions say QMID. Rev. Proc. 2024-31 and the IRS FAQs say QM Code, “a unique 4-character code assigned to a QM by the IRS”, which taxpayers may use “in lieu of a PIN” for property placed in service in 2025 (IRS FAQ, PIN requirements, Q1; Rev. Proc. 2024-31, sec. 5.03). The PIN is the 17-character product identification number the IRS planned to require for each item placed in service from January 1, 2026 (IRS FAQ, PIN requirements, Q3); its first four characters are the manufacturer’s QM Code (Rev. Proc. 2024-31, sec. 5.02).

No IRS document we found says in one sentence that the QMID on the form is the QM Code. We read them as the same code: both have four characters, both apply to 2025 property, and the IRS registration guides call the code a manufacturer accepts in the IRS portal its QMID (Pub. 6046, pp. 3, 29; Pub. 6072, p. 1). Pub. 6072 adds: “Customers will use this code to claim the EEHIC on their 2025 federal income tax return” (Pub. 6072, p. 1).

On that reading, the code identifies the manufacturer, and one code covers all its qualifying products. Lennox, for example, says its QMID “applies across all Lennox-owned brands for IRS Form 5695” (Lennox, QMID Number). The IRS page on manufacturer requirements words it differently: manufacturers must “Assign a qualified manufacturer identification number (QMID) unique to each item of specified property” (IRS qualified manufacturer requirements page, updated August 12, 2026).

If you see “17 characters” in IRS material, it refers to the PIN. The IRS script for its QMID video, updated May 19, 2026, still says “For tax years 2026 to 2032, taxpayers will need a 17-character Product Identification Number”. Under Pub. L. 119-21 there is no 25C credit for property placed in service after December 31, 2025 (FS-2025-05, Q1).

The letters I and O

Rev. Proc. 2024-31 allows “the common digits 0 to 9 and capital letters A to Z, other than I or O” in a PIN and explains: “The letters I and O may not be used because they are easily mistaken for the numbers 1 and 0” (Rev. Proc. 2024-31, sec. 5.02 and footnote 3). The rule is written for the PIN, whose first four characters are the QM Code.

Daikin, Goodman and Amana print their code as I7Q6, beginning with the letter I (manufacturer pages, table below). The IRS e-file known issues list for tax year 2025 describes returns rejected “when a QMID contains letters I and/or O” and gives a workaround; see E-file rejections. No document we found explains how a code with I or O was issued.

Where to get the code

The IRS FAQ says: “The QM should provide taxpayers with its QM Code” (IRS FAQ, PIN requirements, Q7). For a product missing its PIN, the FAQ says “The taxpayer should contact the QM. A QM must make its PINs available to taxpayers, including upon taxpayers’ request” (Q8). For 2025 property, Rev. Proc. 2024-31 requires the manufacturer to give buyers its QM Code no later than the latest of three dates: when you place the property in service, when you ask the manufacturer for the number, or when the manufacturer becomes a qualified manufacturer (sec. 6.03). A manufacturer may also offer a website where you get the number by entering your purchase information (sec. 6.02).

For the credit you “can rely on a manufacturer’s certification in writing that a product is qualified energy property. Don’t attach the certification to your return. Keep it for your records. A valid QMID must also be reported on the applicable line(s).” (2025 Instructions for Form 5695, p. 7).

The IRS does not publish the codes. Its list of qualified manufacturers, updated May 26, 2026, has 123 rows with two columns, the manufacturer’s name and the “Effective date of QM agreement”, and says: “Not all products made by the listed manufacturers will qualify for a credit.” The FAQ adds that “The listing of the QM on IRS.gov does not indicate that any product produced by the QM is eligible” (IRS FAQ, PIN requirements, Q4).

The agreement date on the IRS list

Rev. Proc. 2024-31 says “no § 25C credit is allowed for any specified property produced by a manufacturer prior to the date that the IRS accepts a manufacturer as a QM” (sec. 4.01). A manufacturer that applied by April 30, 2025 is treated as a qualified manufacturer from December 31, 2024, once the IRS validates the application (sec. 4.02; IRS FAQ, Qualified manufacturers, Q3). On the IRS list, 58 of the 123 rows show 1/1/2025 (our count). Two brands on this site show later dates: NORITZ AMERICA CORPORATION, 7/16/2025, and MR COOL LLC, 10/14/2025. Rev. Proc. 2024-31 says the IRS “will publish a list of QMs and the date that their application was accepted” (sec. 4.01), and the IRS FAQ says the same (IRS FAQ, PIN requirements, Q4). The IRS list heads the date column “Effective date of QM agreement”, and no IRS document says how that heading relates to the acceptance date. We found no IRS statement on equipment made before a later agreement date.

Codes published by manufacturers

Codes are shown as each manufacturer prints them, with the name the manufacturer gives the code. The last column shows the closest row of the IRS list, as listed by the IRS, including its spelling (DAIKEN, TECHNOLGIES, RINNIA, HAVAC).

Brand	Code as printed	Manufacturer’s document	IRS list row, as listed (effective date)
Trane	B8T9, “Qualified Manufacturer Code”	2025 manufacturer’s certificates for split heat pump outdoor units, air conditioners and 97 AFUE gas furnaces, naming Trane U.S. Inc. (files last modified January 30, 2026); support article updated February 18, 2026	TRANE TECHNOLOGIES GLOBAL HOLDING II COMPANY LIMITED (1/1/2025)
American Standard	B8T9, “Qualified Manufacturer Code”	2025 manufacturer’s certificates: “American Standard Heating & Cooling, a brand of Trane U.S. Inc.” (files last modified October 14, 2026)	No row under this name
Carrier, Bryant, Payne	No code found in Carrier documents	Carrier’s US tax credit page redirected to its residential home page; its Canadian heat pump page says a PIN “is required” without giving one	CARRIER GLOBAL CORPORATION (1/1/2025); no Bryant or Payne row
Daikin	I7Q6, “QM PIN#”	daikincomfort.com Tax Credits page (no date); its footnote names Daikin Comfort Technologies Manufacturing, Inc.	DAIKEN COMFORT TECHNOLGIES MANUFACTURING LP (1/1/2025)
Goodman	I7Q6, “QM PIN#”	goodmanmfg.com Federal Tax Credit Program page (no date)	No row under this name
Amana	I7Q6, “QM PIN#”	amana-hac.com Tax Credits page (no date); the Amana brochure PF-TaxCred_A-09-25 names Daikin Comfort Technologies Manufacturing, Inc.	No row under this name
Lennox	L7S0 (the last character is the digit zero, by our check), “QMID”	Lennox Support Center, “QMID Number”, modified March 19, 2026	LENNOX INTERNATIONAL INC. (1/1/2025)
Rheem, Ruud, Richmond	K3A8, “QMID”	Rheem water heating certification, effective January 1 to December 31, 2025, naming Rheem Sales Company, Water Heating Division; rheem.com and ruud.com HVAC incentives pages (no date)	RHEEM SALES COMPANY INC. (1/1/2025); no Ruud row
A. O. Smith, State	A5X5, “Qualified Manufacturer (QM) code”	hotwater.com pages on heat pump and gas tankless water heaters; statewaterheaters.com (no dates)	AO SMITH CORPORATION & SUBSIDIARIES (1/1/2025); no State row
Bradford White	V5B3, “QMID or QM Code”	bradfordwhite.com FAQ (no date)	BRADFORD WHITE CORPORATION (1/1/2025)
Rinnai	S6A2, “Rinnai Company Tax Pin Identifier”	rinnai.us Federal Tax Credits page (no date), naming Rinnai America Corporation, effective dates January 1, 2023 through December 31, 2025	RINNIA AMERICA CORP (1/1/2025)
Navien	M6G5, “Qualified Manufacturer Code”	Navien certification “Federal Tax Credit for Jan. 2023 - Dec. 2025” (no date), naming Navien, Inc.	NAVIEN INC. (1/1/2025)
Noritz	K2P9, “Manufacturer ID”	2025 Noritz manufacturer certification statement, naming Noritz America Corporation (file last modified January 22, 2026)	NORITZ AMERICA CORPORATION (7/16/2025)
Mitsubishi Electric	E8X7, “QMID”, “sometimes referred to as a QM Code or QM Pin”	mitsubishicomfort.com rebates page (no date)	MITSUBISHI ELECTRIC TRANE HAVAC US LLC (1/1/2025)
Fujitsu (AIRSTAGE)	F8N3, “Qualified Manufacturer (QM) Code”	airstagehvac.com Inflation Reduction Act page (no date); the code is printed in the section on the HEAR and HOMES rebate programs, and the page does not mention Form 5695	FUJITSU GENERAL AMERICA INC. (1/1/2025)
MrCool	No code found in MrCool documents	Nothing on mrcool.com or MrCool’s support site as of October 26, 2026	MR COOL LLC (10/14/2025)
Weil-McLain	46H2 in the certifications; V6H2 on the FAQ page	Certifications for gas and propane water boilers and for B20 and B100 biofuel, naming WM Technologies, LLC (files last modified July 25, 2026); weil-mclain.com FAQ (no date)	No row under Weil-McLain or WM Technologies
York	No code found	york.com returned a bot-protection page to our request	No row under this name

Check the code against the manufacturer’s certification for your own equipment. Because the IRS does not publish codes, we could not check any of these against IRS records.

We matched brands to list rows by name, and we count a match only where the document that prints the code names the same company as the list (Rheem, Navien and Noritz); a company name in a page footer does not count. For the other rows, the documents we have do not tie the brand to the listed company; Trane’s certificates, for example, name Trane U.S. Inc., which is not the company on the IRS list. For 2025 installs, Weil-McLain’s certifications give “46H2” and its FAQ page gives “V6H2”, and neither document explains the difference. Rheem’s certification also gives a separate code for Friedrich, N2V1; the IRS list has FRIEDRICH AIR CONDITIONING CO LTD (1/1/2025).

What to get from your contractor

IRS documents do not list what a contractor must hand over. These are the items the form, its instructions and IRS pages ask you to enter or keep:

• The date the installation was completed. The IRS says to claim the credit “for the tax year when the property is installed, not merely purchased” (IRS 25C page).
• The address of the home, for line 21c, and for line 17d if you claim Section A items (2025 Form 5695, pp. 2–3).
• The cost of each item, with the labor for preparation, assembly and original installation shown. Section B lines include that labor and Section A lines exclude it, and the form takes the most expensive item on each line separately (2025 Instructions for Form 5695, pp. 5–7).
• The manufacturer’s written certification for your model, with the QMID. American Standard’s certificate tells owners to confirm the eligibility of the model and system combination in the AHRI CEE directory or with the installing dealer (American Standard certificate, p. 1).
• For a split heat pump, the outdoor unit’s manufacturer. The IRS ties the number to the outdoor unit (IRS FAQ, PIN requirements, Q2), so by our reading the 2025 code to enter is that manufacturer’s.
• For panel or circuit work, which equipment it was installed for (the letter on line 25b) and its load capacity (2025 Instructions for Form 5695, pp. 6–7).
• Any rebate or subsidy, including one the contractor received on your behalf (2025 Instructions for Form 5695, p. 2).
• Receipts and installation records, and any Energy Star and National Fenestration Rating Council labels. Documentation is not filed with the return, “it may be required if your tax return is audited”, and the IRS “strongly recommends” keeping it (IRS, How to claim: residential energy property, step 3).

Keep the records as long as they may matter for your taxes, including for the cost basis of your home (IRS FAQ, General questions, Q7). The credit reduces that basis (2025 Instructions for Form 5695, p. 1).

Limits and the credit limit worksheet

Every Part II line is 30 percent of cost, and the form caps the lines this way (2025 Form 5695, pp. 2–4):

• Lines 22d, 23d, 24d and 25e are capped at $600 each. The form adds all central air conditioners on line 22c before the cap, so by our reading of the line two units together give at most $600; lines 23 to 25 work the same way. The instructions word the cap as “A credit limit of $600 for any qualified energy property item” (2025 Instructions for Form 5695, p. 2), and we found no IRS example with two units on one line. The instructions also list the $600 limit by kind of property, “$600 for central air conditioners” and the same for water heaters and furnaces or boilers (2025 Instructions for Form 5695, p. 3).
• Line 26c, home energy audits, is capped at $150. Insulation is capped at $1,200 (18b), doors at $250 for one and $500 for all (19c, 19h), windows and skylights at $600 (20d).
• Line 27 adds lines 18b, 19h, 20d, 22d, 23d, 24d, 25e and 26c, and line 28 takes the smaller of line 27 or $1,200.
• Heat pumps, heat pump water heaters and biomass equipment have their own cap, outside the $1,200: line 29h, at most $2,000.
• Line 30 adds lines 28 and 29h, so the most Part II can reach in one year is $3,200 (our arithmetic; the IRS 25C page gives the same $3,200).

Line 31 limits the credit to your tax. The Energy Efficient Home Improvement Credit Limit Worksheet starts from Form 1040, line 18, and subtracts certain other credits you take, such as the foreign tax credit, the credit for child and dependent care expenses and education credits. Line 32 is the smaller of lines 30 and 31 and also goes on Schedule 3 (Form 1040), line 5b (2025 Instructions for Form 5695, p. 7; 2025 Form 5695, p. 4).

The 25C credit is nonrefundable, and “You can’t apply any excess credit to future tax years” (IRS 25C page). In the words of the IRS FAQ, “the unused amount of the credit may never be claimed” (IRS FAQ, Timing of credits, Q1; FS-2025-01, p. 7).

An example with hypothetical amounts (our arithmetic). A heat pump costs $14,000 installed, and a panel upgrade for it costs $2,500. Line 29h: 30 percent of $14,000 is $4,200, capped at $2,000. Line 25e: 30 percent of $2,500 is $750, capped at $600, with E on line 25b. Line 28 is $600 and line 30 is $2,600. If the worksheet gives $2,100 for line 31, line 32 is $2,100, and the other $500 is lost.

Part I works differently. Line 13 adds the 2025 credit and any carryforward from 2024 (line 12); with only a carryforward from 2024, the form says to “Skip lines 1 through 11”. Line 14 comes from the Residential Clean Energy Credit Limit Worksheet, line 15 is the smaller of lines 13 and 14 and goes on Schedule 3, line 5a, and line 16 is the “Credit carryforward to 2026” (2025 Form 5695, p. 1). The 25D worksheet subtracts the Part II credit from line 32 along with other credits (2025 Instructions for Form 5695, p. 5). By our reading, the 25C credit uses up your tax first, and the 25D credit that does not fit carries forward.

Carrying 25D forward: the 2026 form

If the tax limit on line 14 is less than line 13, the 2025 instructions say “you can carry the unused portion of the credit to 2026. File this form even if you can’t use any of your credit in 2025” (2025 Instructions for Form 5695, p. 5). The amount carried is line 16 of the 2025 form. The 25C credit cannot be carried this way (IRS FAQ, Timing of credits, Q1).

As of October 26, 2026 the IRS has not released the final 2026 Form 5695. Its list of current forms shows only the 2025 form, posted November 21, 2025, and the 2025 instructions, posted January 29, 2026 (IRS Forms, Instructions and Publications, search 5695). The IRS Draft Tax Forms list has a draft 2026 form, posted May 26, 2026, and draft 2026 instructions, posted September 1, 2026, both titled “Carryforward of Residential Energy Credit”. The IRS warns: “Do not file draft forms and do not rely on information in draft instructions or publications” (IRS Draft Tax Forms, search 5695; IRS e-mail bulletin, September 1, 2026).

The draft form has four lines (draft 2026 Form 5695, p. 2):

Line	Wording in the draft
1	Credit carryforward from 2025. Enter the amount, if any, from your 2025 Form 5695, line 16
2	Limitation based on tax liability. Enter the amount from the Residential Clean Energy Credit Limit Worksheet. (See instructions.)
3	Residential clean energy credit. Enter the smaller of line 1 or line 2. Also include this amount on Schedule 3 (Form 1040), line 5a
4	Credit carryforward to 2027. If line 3 is less than line 1, subtract line 3 from line 1

The draft instructions say: “You may claim only a carryforward of any unused residential clean energy credit (which is shown on your prior-year Form 5695, line 16).” For line 4 they repeat the 2025 wording: “File this form even if you can’t use any of your credit in 2026.” They also keep the 2025 paragraph on the end of both credits (draft 2026 Instructions for Form 5695, p. 2). The draft has no lines for 25C or for 25D property installed in 2026 (our reading of the four-line form).

Fixing a 2025 return

Amended return (Form 1040-X)

The IRS FAQ on timing answers the amended-return question with “Yes” and adds: “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” (IRS FAQ, Timing of credits, Q3; FS-2025-01, p. 7). A return filed before its due date counts as filed on the due date (IRS, Time you can claim a credit or refund). For example, a 2025 return filed by April 15, 2026 counts as filed on April 15, 2026, which puts the three-year limit at April 15, 2029 (our arithmetic; the two-year limit from the date you paid the tax can end later).

The Form 1040-X instructions, revised December 2025, say for line 7: “Attach the appropriate forms for the credits you are adding or changing.” For 2025 equipment, that is the 2025 Form 5695. The IRS amended-returns page says to submit a complete amended Form 1040 with your changes and to “Attach any supporting documents and new or changed forms and schedules”, and adds: “You can file up to 3 amended returns for the same year” (IRS, Amended returns). Form 1040-X can be filed electronically for the current or two prior tax periods (IRS, About Form 1040-X).

A 2025 return not filed yet

“File all tax returns that are due, regardless of whether or not you can pay in full” (IRS, Filing past due tax returns). Equipment installed in 2025 goes on the 2025 Form 5695 with that return. On refunds, the same IRS page says: “If you are due a refund for withholding or estimated taxes, you must file your return to claim it within 3 years of the return due date.” The IRS page on refund time limits counts three years from the date you filed (IRS, Time you can claim a credit or refund). The two pages are worded differently, and we did not resolve the difference.

IRS letters: CP12 and Letter 12C

A CP12 notice says: “We corrected one or more mistakes on your tax return. As a result, you are now either due a refund or your original refund amount has changed.” If you agree, “no response is required”. If you disagree, “contact us at the number shown on the notice by the date indicated”; if you miss that date, you “will lose formal rights to have the change(s) reversed, as well as your right to appeal our decision to the U.S. Tax Court”, though the IRS says it will still consider documents sent later (IRS, Understanding your CP12 notice).

A Letter 12C says: “We need more information to process your individual income tax return.” The information can include “Verification of income, withholding and credit amounts”. The IRS asks you to send it within 20 days, to respond even if you disagree, and: “Do not file a Form 1040-X” (IRS, Understanding your Letter 12C).

Neither page mentions Form 5695 or the QMID. The IRS manual for processing returns, written for IRS employees, contains this notice text: “We disallowed all or part of the credits you claimed on Form 5695 Residential Energy Credits because one or more Qualified Manufacturer Identification Number(s) (QMIDs) didn’t match our records” (IRM 3.12.3, Exhibit 3.12.3-1, taxpayer notice code 583). The manual does not say which letter prints it.

E-file rejections when a QMID has an I or O

The IRS list of known e-file issues for tax year 2025 has two open entries for Form 5695: “Submission are being rejected by Business Rule X0000-005 with Form 5695 attached when a QMID contains letters I and/or O”, and “IRS5695 schema does not allow QMID fields to contain letters I and/or O”. The spreadsheet, listed as updated October 16, 2026, gives January 1, 2027 as the projected resolution date (IRS, Known issues and solutions, tax year 2025, rows 28 and 29).

The IRS workaround reads: “Taxpayers filing Form 5695 for Tax Year 2025, with a QMID containing letters I and/or O, should leave those QMID fields blank on the Form 5695 and attach to the return a binary attachment or [GeneralDependencySmall] with the description beginning with ‘Substantiate QMID’.” The statement gives the QMID provided by the manufacturer, the cost, and the line and a short description of each item placed in service in 2025. The IRS warns that “this may result in delays in processing the return, which can delay the refund.” The same entry says a schema fix was made in version 2025v5.2, and that the workaround is still needed until the software moves to that version or later. For paper returns we found no IRS document on QMIDs with these letters.

Mistakes the IRS documents warn about

• The credit goes on the return “for the tax year when the property is installed, not merely purchased” (IRS 25C page; IRS 25D page). For 25D, paying by December 31, 2025 does not help if installation was completed after that date (FS-2025-05, Q7).
• 25C is not available for 2026 equipment: “You can’t claim energy efficient home improvement credits for expenditures or property placed in service after December 31, 2025” (2025 Instructions for Form 5695, p. 1). IRS documents word the end dates differently; see IRS pages that differ from the law.
• An item without a QMID does not count: “you must provide a valid QMID for each item” (2025 Instructions for Form 5695, p. 5).
• Part II does not cover a newly built home. The credit is for an existing home or an addition or renovation, “but not for a newly constructed home” (IRS FAQ, Qualifying residence, Q2; 2025 Instructions for Form 5695, p. 5).
• A landlord who does not live in the home cannot claim it: “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).
• Subsidies and rebates come off the cost, including a subsidy your contractor received for you (2025 Instructions for Form 5695, p. 2; IRS 25C page).
• An unused 25C credit does not carry forward to 2026 or any later year (IRS FAQ, Timing of credits, Q1).
• Used equipment does not qualify: “Used property is not eligible for the credit” (IRS FAQ, General questions, Q1). Line 21b asks whether you originally placed the property in service (2025 Form 5695, p. 3).
• Loan interest, origination fees and extended warranties are not part of the cost (IRS FAQ, General questions, Q8).
• The manufacturer’s certification stays with you: “Don’t attach the certification to your return. Keep it for your records.” (2025 Instructions for Form 5695, p. 7).
• An amount on a second line such as 22b or 29b needs the statement listing the QMID and cost of each item on it (2025 Instructions for Form 5695, pp. 6–7).
• In a shared home, each joint occupant “must complete their own Form 5695”. When the occupants’ combined credit for an item would exceed its cap, each takes a share of the cap in proportion to what they paid, checks line 32a and attaches a statement explaining the allocation (2025 Instructions for Form 5695, p. 3). The IRS corrected this calculation in January 2026: About Form 5695 lists the correction under January 23, 2026, and the correction applies to copies of the instructions downloaded or printed before January 26, 2026. The instructions posted January 29, 2026 contain the corrected text (our comparison).
• Condominium and cooperative owners who claim a fractional share check line 32b (2025 Instructions for Form 5695, p. 7). A condominium association member or cooperative tenant-stockholder is treated as having paid a proportionate share of the association’s or corporation’s costs (2025 Instructions for Form 5695, p. 2).

What we could not confirm

• The final 2026 Form 5695 and its instructions. On October 26, 2026 only the drafts exist, so everything above about the 2026 form comes from drafts.
• That the QMID on the form is the QM Code of Rev. Proc. 2024-31. This is our reading; no IRS document says it in one sentence. The IRS qualified manufacturer requirements page calls the QMID “unique to each item”.
• How the code I7Q6 published by Daikin, Goodman and Amana fits the Rev. Proc. 2024-31 rule against I and O, and how to report such a code on a paper return.
• Which Weil-McLain code applies: 46H2 in its certifications or V6H2 on its FAQ page.
• Manufacturer codes for Carrier, Bryant, Payne, York and MrCool. Carrier’s US tax credit page redirected to its residential home page on October 26, 2026, york.com returned a bot-protection page to our request, and we found no code on mrcool.com or MrCool’s support site. Other websites publish codes for some of these brands; we do not repeat codes that are not from the manufacturer or the IRS.
• Which IRS list row belongs to which brand, except Rheem, Navien and Noritz.
• What the agreement dates of Noritz (7/16/2025) and MR COOL (10/14/2025) mean for their equipment made earlier in 2025.
• Final regulations for 25C. The only Federal Register document is the proposed rule of October 25, 2024 (89 FR 85099, REG-118264-23). We found no final rule in the Federal Register, and the eCFR for Title 26, up to date as of October 22, 2026, has no section 1.25C.
• The amended text of 26 U.S.C. 25C and 25D. On October 26, 2026 the section pages of uscode.house.gov returned “Page Not Found” while the site runs in a temporary format, and govinfo returned an error page for the 2025 edition of these sections. The carryforward rule is in 25D(c) of the 2024 edition; Pub. L. 119-21, sec. 70506(a), amends 25D(h), and by our reading leaves 25D(c) in place. The 2025 instructions and the 2026 draft both provide for carryforward.
• Whether qualified manufacturers still file a report for 2025. The IRS requirements page, updated August 12, 2026, and Rev. Proc. 2024-31, sec. 7.08, say one report is due by January 15, 2026; FS-2025-05, Q6, says periodic reports “are no longer required”. Neither affects what you enter on the form, by our reading.
• The year of the October 15 extension date. The IRS extension page gives “October 15” without a year; for 2025 returns we read it as October 15, 2026.
• A link between CP12 or Letter 12C and Form 5695. Neither IRS page mentions the form or the QMID.

See also

• Water heater size calculator
• Heat pump vs gas calculator
• R-410A after 2025: EPA rules for home AC and heat pumps
• 2029 water heater regulations: the DOE standard from May 6, 2029
• Furnace and HVAC tax credits for 2025 and 2026: 25C ended after 2025
• Gas water heater pilot won't stay lit: thermocouple, thermopile and the status light
• Why a mini-split stops heating for a few minutes in winter: defrost and hot start
• How a gas furnace lights, and how the control board blinks a failure code
• How a tankless water heater lights: ignition codes by brand
• Home maintenance schedule from the manuals: monthly to yearly
• Winter home maintenance checklist: furnace, boiler, water heater
• Water heater or furnace closet: clearance and air requirements

Error codes: Carrier, Daikin, Fujitsu, Goodman, Lennox, Mitsubishi Electric, MrCool, Navien, Navien boilers, Noritz, Rheem, Rheem furnaces, Rheem gas tank water heaters, Rinnai, Trane and American Standard, Weil-McLain, York, Coleman and Luxaire