Beginning January 1, 2024, residents of Colorado will be eligible for tax credits to install heat pumps for both space and water heating.
By: Editorial Staff
Updated January 16, 2025
How does it work?
All Coloradans who install an eligible heat pump through a registered contractor will receive a portion of the tax credit as a discount at the time of installation
UniColorado is a registered contractor.
What's eligible
air-source heat pump
ground-source heat pump
water-source heat pump
combined-source heat pump
heat pump hot water heater
thermal energy network
VRF heat pump system
What's the minimum discount?
Air-source heat pump
$499.95
Ground, water, or combined-source Heat pump
$990.90
Heat pump water heater
$165.65
The contractor gives you this discount upfront. The amount shown is the minimum.
What are the rules?
Heat pumps for space heating/cooling must cover at least 80% of annual heating needs.
Installation must be done by a registered contractor, who provides the tax credit as a discount on installation costs.
Contractors handle all paperwork and submit it to the Department of Revenue.
The state reimburses contractors through a tax credit when they file taxes.
Customers receive the discount directly and don’t need to file any paperwork.
TL;DR
For Colorado homeowners purchasing a new heat pump system, a registered contractor can offer an upfront discount on eligible installations. This discount is actually a tax credit for the contractor. UniColorado is a registered contractor.
What's eligible for the Colorado state heat pump tax credit in 2024?
A variety of heat pump systems, as long as they provide at least 80% of annual heating needs are eligible for the CO heat pump tax credit.
How much is the Colorado state heat pump tax credit?
The total tax credit is $1,500 and 66.6% can be retained by the contractor. Remainder should be offered to the customers as a discount upfront (“minimum discount”).
Who is in charge of the Colorado heat pump tax credit?
At UniColorado Heating & Cooling, we don’t believe in doing the least. Enjoy discounts of $1,000 – $1,500 using the Colorado State Heat pump tax credit on all eligible systems when you purchase a heat pump system from Colorado’s most experienced heat pump contractor.