Electrification Savings

Colorado Heat Pump Tax Credit

Beginning January 1, 2024, residents of Colorado will be eligible for tax credits to install heat pumps for both space and water heating. In 2026 and after, the credit has been reduced to $1,000 for heat pumps.

By: Editorial Staff
Updated February 5, 2026

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

$333

Ground, water, or combined-source Heat pump

$667

Heat pump water heater

$83

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 2026?

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 for the State of Colorado Heat Pump Contractor is $1,000 for 2026 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?

The Colorado Energy Office in conjunction with the Dept of Revenue.

OTHER TAX CREDITSOTHER TAX CREDITSOTHER TAX CREDITSOTHER TAX CREDITSOTHER TAX CREDITS

✅ Available

Xcel Energy Rebates

For Xcel account holders.

Learn More

✅ Available

CO Heat Pump Credit

For all Colorado residents.

Learn More

✅ Available

HEAR Rebates

Income restricted federal incentives.

Learn More

$5M+

Saved for our homeowners through eligible rebates in 2025

Up to $22,150

In potential savings

12,000+

Heat pumps installed by UniColorado

Trusted by neighbors.

Loved By Homes ❤️

Heat Pump Installation Done Right

Other Related Services

All Services

Whole House Electrification

Heat Pump Water Heater

Go beyond the minimum with UniColorado.

At UniColorado Heating & Cooling, we don’t believe in doing the least. Enjoy discounts of $1,000 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.