Heat Pump State Rebates 2026: The Complete List

The four layers of heat pump money

Heat pump incentives are confusing because they come from four different places, each with its own rules. Understanding the layers is the key to capturing all the money you're entitled to:

1. Federal tax credits — the 25C credit (air-source, 30% up to $2,000) and the 25D credit (geothermal, 30% uncapped). These reduce your federal tax bill.
2. Federal HEEHRA / HEAR rebates — up to $8,000 for income-qualified households, paid as an upfront discount, administered by each state.
3. State rebates — programs run by state energy offices, available to all income levels in many states.
4. Utility rebates — offered by your electric or gas utility to promote efficient electrification.

The first two are national; the last two vary enormously by location. The good news is they generally stack, so many households combine three or four of them.

The federal credits (available everywhere)

Two federal tax credits apply in every state, and the distinction between them is worth thousands of dollars:

• Air-source heat pumps (25C): 30% of cost, capped at $2,000 per year, for models meeting the CEE highest-efficiency tier. The cap resets annually and there is no carryforward.
• Geothermal heat pumps (25D): 30% of cost with no cap, and unused credit carries forward to future years — the same treatment solar receives.

Both are claimed on IRS Form 5695. We cover them in full in the heat pump tax credit guide. Because they are tax credits, you need a tax liability to use them (the air-source 25C is non-refundable and doesn't carry forward; the geothermal 25D does).

HEEHRA / HEAR: up to $8,000 for income-qualified homes

The Inflation Reduction Act funds the Home Electrification and Appliance Rebates (HEAR, sometimes called HEEHRA) program, administered by each state. For a qualifying heat pump, eligible households receive an upfront point-of-sale rebate:

Households below 80% of area median income (AMI) can receive 100% of project cost up to the cap; those at 80–150% AMI receive 50%. Above 150% AMI, you rely on the tax credit and state/utility rebates instead. Programs are rolling out state by state, so check your state energy office for current status.

How federal and state incentives stack

The layers generally combine, but with one important rule: you cannot claim the same dollar twice. In practice:

• The federal tax credit is calculated on your net cost after rebates — if a state rebate lowered your price, the 30% credit applies to the reduced amount.
• HEEHRA and the 25C tax credit can be used together, but you cannot use both a HEEHRA rebate and a separate state rebate on the same equipment in most program designs.
• Utility rebates usually stack on top of everything and are treated separately.

A common income-qualified stack looks like: HEEHRA covers a large share upfront, a utility rebate knocks off a few hundred to a couple thousand more, and the federal credit applies to whatever you actually paid. The result can be a very low or near-zero net cost.

Northeast: the most generous region

The Northeast leads the country on heat pump incentives, driven by aggressive state climate goals:

• Massachusetts (Mass Save) — whole-home heat pump rebates historically up to $10,000, among the richest in the US.
• New York (NYS Clean Heat, via utilities) — per-ton rebates that can total several thousand dollars.
• Maine (Efficiency Maine) — a national leader in adoption, with per-unit rebates and low-income adders.
• Vermont, Connecticut, Rhode Island, New Hampshire — utility and efficiency-program rebates, often $500–$2,000+ per system.

If you live in the Northeast, your state or efficiency program is likely the largest single rebate available to you — check it first, before assuming the federal credit is your main benefit.

Mid-Atlantic

The Mid-Atlantic offers solid, if more modest, programs:

• New Jersey — the state's Clean Energy Program offers heat pump rebates, with adders for whole-home electrification.
• Maryland — EmPOWER Maryland utility rebates plus state programs.
• Pennsylvania — primarily utility-administered rebates, varying by service territory.
• Virginia — utility rebates plus the rolling-out federal HEAR program.

Several of these states also appear in our solar-by-state guides, and many homeowners pair a heat pump with solar to cover the added electric load — see our heat pump + solar savings math.

Midwest

Midwest incentives are largely utility-driven but can be meaningful, especially from the larger investor-owned utilities:

• Illinois — ComEd and Ameren efficiency rebates for qualifying heat pumps.
• Michigan — DTE and Consumers Energy rebate programs.
• Minnesota — a strong cold-climate heat pump rebate ecosystem via utilities and the state.
• Wisconsin (Focus on Energy) and Ohio — statewide and utility rebates.

Because much of the Midwest is a cold climate, prioritize a NEEP-listed cold-climate model and stack the utility rebate with the federal credit and, if eligible, HEAR.

West Coast and Mountain West

The West combines state ambition with active utility programs:

• California — TECH Clean California and the statewide push toward heat pumps, plus generous utility rebates; California targets millions of heat pumps installed this decade.
• Oregon (Energy Trust of Oregon) and Washington — strong utility and state rebates.
• Colorado — a state heat pump tax credit plus utility rebates, one of the better Mountain West stacks.
• Nevada — utility rebate programs via NV Energy.

The West's mild-to-moderate climates also mean a heat pump's running-cost advantage over gas is often smaller, so the upfront rebate stack does a lot of the work in making the math attractive.

Southwest and South

In warmer regions, the cooling benefit dominates and incentives are more utility-led:

• Arizona, New Mexico, Texas — utility rebates (e.g., APS, SRP, El Paso Electric, Oncor-area programs) for high-efficiency heat pumps that double as efficient AC.
• Georgia, North Carolina, South Carolina — Duke Energy and other utility rebates; several of these states also have strong solar economics (see our North Carolina guide).
• Florida — utility rebates plus the cooling-season efficiency win; see our Florida solar guide for pairing with solar.

In the South, a heat pump is often the default replacement for an aging AC plus electric or gas heat, and the federal credit plus a utility rebate is the typical incentive package.

Utility rebates: don't overlook them

Your electric (and sometimes gas) utility almost certainly runs an efficiency-rebate program, and these are frequently overlooked because they sit outside the headline federal and state news. Utility rebates for heat pumps commonly range from a few hundred dollars to over $2,000 per system, sometimes structured per ton of capacity or tied to a minimum efficiency tier.

Because utilities want to manage peak electric demand, some offer extra incentives for smart thermostats or demand-response enrollment alongside the heat pump. Always check your specific utility's website or call them — this is often the easiest rebate to claim, applied at point of sale by a participating contractor.

How to find your exact rebates

Because programs change and vary by ZIP code, use authoritative, up-to-date sources rather than assuming:

1. DSIRE (dsireusa.org) — the comprehensive, NC State-maintained database of every state and utility incentive; search by your ZIP.
2. Your state energy office — for HEAR/HEEHRA status and state-specific programs.
3. Your utility's website — for current rebate amounts and qualifying equipment lists.
4. ENERGY STAR Rebate Finder — a quick first-pass lookup by ZIP.

A reputable installer will also know the local programs cold and often handles the paperwork — but verify independently, because the installer's incentive to maximize your rebates isn't always perfectly aligned with yours.

Timing your project to maximize incentives

Smart timing can meaningfully increase what you collect. Because the 25C tax credit caps at $2,000 per year and resets each January, spreading a larger electrification project across two tax years can let you claim it twice — for example, a heat pump in December and a heat pump water heater or panel upgrade the following January.

Rebate budgets also matter: many state and utility programs are funded in annual or quarterly tranches and can run out, so applying early in a program cycle improves your odds. And because HEAR is still rolling out unevenly, income-qualified households may benefit from waiting until their state's program is live rather than locking in now and missing the upfront rebate.

How to claim everything, step by step

1. Confirm the model qualifies — CEE highest tier for the 25C credit; check rebate-program equipment lists for state/utility rebates.
2. Apply for upfront rebates first — HEAR and most state/utility rebates are applied at point of sale or via a participating contractor, lowering your invoice.
3. Keep documentation — itemized invoice, manufacturer certification statement, model numbers, and the placed-in-service date.
4. File Form 5695 — claim the 30% federal credit on your net (post-rebate) cost.

Estimate your net cost after the credit with the Heat Pump Cost Calculator, then sanity-check the overall payoff with the Is It Worth It? tool.

A worked example

Consider an income-qualified household (below 80% AMI) in a Northeast state installing a $16,000 ducted cold-climate heat pump. HEEHRA covers up to $8,000 of the equipment and install; a state efficiency-program rebate adds $2,000; a utility rebate contributes $500. That leaves about $5,500 paid out of pocket, on which the 30% federal credit (capped at $2,000) returns roughly $1,650 at tax time. Net cost: under $4,000 for a system listed at $16,000.

A higher-income household in the same state can't use HEEHRA but might still combine a $2,000 state rebate, a $500 utility rebate, and the $2,000 federal credit — trimming the $16,000 price to about $11,500. Either way, stacking the layers is what turns a heat pump from a stretch into a sensible buy.