2025 Federal Heat Pump Tax Credit for Mainers
What Maine Homeowners Need to Know
Brought to you by Only Heat Pumps
At Only Heat Pumps, we spend a lot of time talking with Maine homeowners about comfort, efficiency, and long-term savings. One of the biggest questions we hear in 2025 is:
“Do I qualify for the federal heat pump tax credit?”
The short answer: most homeowners do — and the savings can be significant. Here’s everything you need to know if you installed a heat pump in 2025 (or are planning to).
What Is the Federal Heat Pump Tax Credit?
The federal heat pump tax credit is part of the Energy Efficient Home Improvement Credit (IRS Section 25C), expanded under the Inflation Reduction Act.
For qualifying heat pump installations completed in 2025, homeowners may be eligible for:
30% of the total project cost
Up to $2,000 back as a federal tax credit
Applies to equipment + labor
This credit helps offset the upfront cost of upgrading to an energy-efficient heat pump—something especially valuable here in Maine, where heating costs matter.
Who Qualifies in Maine?
You may qualify if:
✔️ The home is your primary residence
✔️ The heat pump was installed in 2025
✔️ The system meets ENERGY STAR® efficiency requirements
✔️ You paid for the installation (not fully reimbursed)
Most cold-climate heat pumps we install in Maine are specifically designed to meet these federal efficiency standards.
What Types of Heat Pumps Qualify?
In most cases, the following systems qualify when properly sized and installed:
Ductless mini-split heat pumps
Ducted heat pump systems
Cold-climate air-source heat pumps
Please note that Geothermal (ground-source) systems qualify under a different federal credit with higher limits.
If you worked with Only Heat Pumps, we can confirm whether your specific system qualifies. Even if you didn’t work with us, please send us an email, and we will help you confirm or deny this.
How This Works with Efficiency Maine Rebates
Many of our customers may have also received Efficiency Maine rebates, which are separate from the federal tax credit.
Good news:
✅ You can usually use both
❌ You can only claim the tax credit on the portion you actually paid
Example:
If your project cost $15,000 and you received a $3,000 rebate, the federal credit applies to the remaining $12,000.
Please note that if you did not receive an Efficiency Maine Rebate BEFORE your installation, you do not qualify retroactively. The tax credit, however, is designed for retroactive application.
What You Need to Do: Tax Credit Checklist ✅
Here’s a simple checklist to help you stay organized for tax time:
🧾 Federal Heat Pump Tax Credit Checklist (2025)
⬜ Installed a qualifying heat pump in 2025
⬜ Home is your primary residence
⬜ Saved your paid invoice
⬜ Kept proof of payment
⬜ Recorded system make, model, and efficiency rating
⬜ Obtained the manufacturer’s certification statement
⬜ File IRS Form 5695 with your 2025 tax return
⬜ Claim up to $2,000 in federal tax credit
📌 Tip: Keep all documentation for your records. You don’t submit everything with your return, but the IRS may request it later.
Frequently Asked Questions
Is this a rebate or a tax credit?
It’s a tax credit, meaning it reduces the amount of federal tax you owe. It does not exceed your tax liability.
Is there an income limit?
No. The federal heat pump tax credit is not income-based.
Does replacing oil or propane matter?
No. Many Maine homeowners upgrade from oil or propane — fuel type does not affect eligibility.
Can I claim multiple indoor units?
Yes. The credit applies to the entire qualifying system, up to the annual cap.
Should I talk to my accountant?
Always recommended. We provide the system details — your tax professional applies them correctly.
Why Maine Homeowners Are Upgrading with Only Heat Pumps
Heat pumps aren’t just about savings at tax time. They offer:
Lower monthly energy bills
Reliable heating in Maine winters
Cooling in the summer
Reduced carbon footprint
Increased home value
And with federal tax credits still available in 2025, it’s one of the best times to upgrade.
Get Help with Your Heat Pump & Tax Credit
If you installed a heat pump with Only Heat Pumps in 2025 and have questions about your eligibility — or if you’re considering an upgrade — we’re happy to help.
👉 Contact us today for a personalized quote, system review, or help understanding rebates and tax credits for your home.
Only Heat Pumps — Maine comfort, done right.