Hey guys! By Request I'm going to do this video. I've had a few of you request a video on this particular topic and that is the Inflation Reduction Act that came out last year. It's gone to effect during the recording of this video, but I Do want to disclaimer this before we dive into this: Whether you're in the market for heating and air system or you're going to do one of the other things that are covered in the Inflation Reduction act, you try to get a rebate or a tax incentive that I Definitely think you should check with a Tax professional. check with your CPA how did you um, get into financial consulting Department of Labor Statistics indicate it's one of the fastest growing professions.

Okay, make sure what you're about to do qualifies for one of these programs because it is very complicated. I've been working on doing some homework on all of this and trying to put together this video. and because of that I'm going to avoid going into a few things because I don't want to give you anything that's inaccurate. but I think if you are in the market for a heating and air system, knowing a few of these things might point you in the right direction, it might tell you whether you're not going to qualify for a few of these things or you might actually qualify.

Even if you think you qualify, definitely check with the Tax Professional. The first thing I want to talk about before we dive into this deeper is there are several kind of programs at once here. So it's the Inflation Reduction Act But underneath that umbrella here as we dive into this: whether you're talking about your heating and air system or any of the other projects that you could do with your home that might qualify for this money, that there is this umbrella of different programs. So it's a whole bunch of programs, different timelines and to be honest with you, I'm reading conflicting information I've read several articles and some of them are saying one thing and some of them are saying another, ain't nobody got time for that So again, I'm not going to Dive In Too Deep But I wanted to highlight of all of these programs one in particular and that is the High Efficiency Electric Home Rebate Program and I will say of these articles I was reading some of them were saying that it started on this date, some of them were starting on that date, but I think they can all agree even if it started earlier, that this program should definitely be in effect during the recording of this video which means the year 2023.

Okay, it's happening. everybody. stay calm. Supposed to be a 10-year program and it has incentives up to eight thousand dollars for a heat pump system.

Now it's not just any old heat pump system. You have to meet certain requirements such as a 15.2 CR2 or above rating and that goes for package units as well. Now I will say one of the conflicting things I was reading was some of these articles are saying that many splits don't qualify at all, but some of them were saying at least this one says that mini split 16 Seer 2 or above do qualify. So that is definitely one of the things you want to check on.

I Do want to also say that they are saying that the systems that qualify must be energy STAR Certified. It must not exceed fourteen thousand dollars in Combined rebate per household. It may not combine rebates with the homes rebate program, so that's another rebate program. Some of these programs are tax incentives and some of them are actual cash rebate.

Just want to preface that. the other thing I Want to point out this rebate is based on your income. If the income of your household is 150 percent or more of the median household income in your area, then you don't qualify. Bummer, huh? This is the bummer man and the easiest way I Have found I've been on all kinds of websites and articles and trying to figure this out.

I Think the easiest way for you to decide if you are going to qualify is take your income so whatever your actual income is, multiply it by 1.5 and so whatever that number is you want to go to the website. I'm going to put a link down to the description and basically you're going to be able to go and put in your area and find out what the average income is in your area now. I Will say if you do qualify based on your income, there are two different rebates and we're going to dive more into that in just a second. But before we do, let's go through some of the things that this particular rebate covers: The amount of the rebate per qualified household on an energy STAR Certified Appliance Upgrades under a qualified electrification project up to eight thousand dollars for heat pump for space heating and cooling.

It goes on to talk about other programs such as electric load meaning your server service, panel, insulation, air sealing ventilation, twenty five hundred dollars for electrical wiring, and the purchase of an appliance or non-appliance under qualified electrification project. So I'm not going to go into any of that. We're going to focus mostly on that eight thousand dollar rebate for the heat pump systems. If you are looking at getting a furnace, whether it's a gas furnace or if it's anything like that, you will not qualify for this.

So this is only for Pure Electric heat pump systems with an air handler or some sort of electric furnace. Something inside match with that heat pump that is straight electric. And as I said a moment ago, your household income plays a role with this. If your household income is below 80 percent of your area median income, then 100 of system purchase price qualifies for the rebate.

If your household income is between 80 to 150 percent of the area median income than 50 percent of the system purchase price qual qualifies for the rebate. If your household income is greater than 150 percent of the area median income, then you are not eligible for this rebate. The project can be a part of new construction, so this can be a new home. It can replace a non-electric Appliance So whether it's gas, oil or coal says coal I Have only laid eyes on one coal boiler in my entire career, so here in Virginia that is not something you see a lot of and this can also be a first time purchase with respect to the Appliance Appliance System equipment, infrastructure component, or other related items must be certified under the Energy Star program and the project carried out at or relating to a single family home or multi-family building as applicable and defined by the secretaries.

Another article I was reading said that the household size so how many folks live in your home will also affect this and I Found this calculator on Rewiringamerica.org I'm going to put a link to that calculator down below, but basically you put in your ZIP code, you put in your income, you put in your how many folks live in your house and a few other things and you click calculate and it will tell you how much you actually are eligible for. Another question we've seen is folks asking can you stack this rebate with other federal tax programs or federal tax credits and the answer is yes, they do have restrictions. You can't pair it with that other rebate program, but you can include it with a 25 C Non-business Energy Property Tax Credit program. The 25c tax program allows homeowners to deduct up to 30 percent of their costs for any qualifying Energy Efficiency project or up to two thousand dollars for heat pump installation.

so you'll be able to stack this with other programs. And maybe I've heard some folks saying that they're being able to save almost the entire project. so let me say this as we're wrapping up here here: I Obviously am not a tax professional I Was very reluctant to even do a video on this I didn't for the longest time, but I Decided to maybe touch base on this particular program. Number one, because it's a pretty good program.

There's a pretty large incentive there. there's a rebate rather not incentive I Have even had customers of hours at Griffin Air approach us asking us about some of these programs and it's a little complicated and I certainly don't like to tell folks anything that's incorrect. You definitely want to check with your tax professionals, but does it make sense for you? I will say maybe it doesn't make sense for you in your particular situation. Some of these energy STAR certified systems can be quite pricey in comparison to what you were maybe going to spend money on anyway.

So if you're not looking at staying in the house forever, you're not looking for long-term Solutions You're not looking to make a decision that would make sense in the long run, then the money you would save with this rebate may not make sense when the extra money you have to spend to get one of these systems that would qualify 5 for this tax credit. The other thing I would point out is if you're in a particular area that you would not necessarily want a heat pump or at least a straight electric heat pump, then this particular program may not be for you either. Some of you folks comment on our videos all the time talking about how you don't necessarily like a heat pump system for one reason or another. I Do think that you're going to see more and more heat pump systems hitting the market.

So that said, this is just one of the programs again there are actually several under that umbrella of the Inflation Reduction Act and so again I would encourage you to go to your tax professional before pulling the trigger. see if the system you're about to spend money on does meet these requirements. Last thing I'll point out is some folks think well if I just get a really high efficiency system, a high sear system or CO2 now and it's automatically Energy STAR certified and I will caution you that that is not the case that there are a lot of systems out there even though they're high of efficient or they are saving you energy. In the end, they don't necessarily meet the requirements for these programs because they're not energy STAR Certified How these systems get energy STAR Certified is a topic for a whole other video.

but I Just want to caution you on that. Make sure before you pull the trigger and you are purchasing one of these systems that you make sure that it does qualify for what you think it's going to qualify for. Are you in the market for a heating and Air system? You're wondering if you qualify for one of these rebates? Or maybe you have found out that you did qualify and have something to share with that? Please comment down below. We love hearing about that sort of stuff.

Maybe you can help others with your experience as well. Thanks for watching Hit that subscribe button. We'll see you next time.