Federal Heat Pump Tax Credit 2026-2027: It Ended
There is no federal heat pump tax credit for 2026 or 2027. The 25C credit ended December 31, 2025. Colorado money is still here: Xcel rebates, Power Ahead Colorado, and the state credit stack to about $7,000 on a 3-ton heat pump in the Denver metro.
Updated October 13, 2026•By Editorial Staff
Is There a Federal Heat Pump Tax Credit in 2026 or 2027?
No. The federal 25C credit ended December 31, 2025, and nothing replaced it for 2026 or 2027. A heat pump installed now gets no federal tax credit.
The money that's left is from Colorado: Xcel's rebate ($1,500 per heating ton for a cold climate heat pump), Power Ahead Colorado ($1,500 in the Denver metro), and the state heat pump credit ($1,000 for installs through 2028). On a 3-ton heat pump in the Denver metro that adds up to about $7,000, more than the federal credit ever paid. We take all three off your invoice. Every program is in our Colorado heat pump rebates guide.
The federal credit was up to $2,000 a year. It came from the 2022 Inflation Reduction Act and was meant to run through 2032. The One Big Beautiful Bill Act ended it early.
If You Installed in 2025 or Earlier
Gather Documentation
Manufacturer certification, contractor invoice, proof of payment
Download Form 5695
Residential Energy Credits form from IRS.gov
Complete Part II
Enter qualifying expenditures and calculate credit
File With Tax Return
Include Form 5695 with your 2025 federal return
You can still claim the 25C credit for qualifying installations completed before January 1, 2026. The credit applies to the tax year the installation was completed, not when you paid. If you already filed your 2025 return without it, ask your tax preparer about amending it.
You qualify if
Installation completed before January 1, 2026
Equipment met ENERGY STAR or CEE requirements at time of install
Property is your primary residence
Have manufacturer certification and contractor invoice
Not eligible if
Installation in 2026 or later
Rental or second home installations
DIY installations without proper documentation
Resources for 2025 Claims
Need Documentation for a 2025 Claim?
If UniColorado installed your heat pump in 2025 or earlier, we can provide the manufacturer certification (QMID code) and itemized invoice you need for Form 5695. Contact us if you need copies of your installation documentation.
For new installations in 2026, the federal credit is gone, but Colorado programs now provide more in total incentives. See our complete rebate guide for current programs.
See What's Available in 2026
Xcel, Power Ahead Colorado and the state credit still stack to around $7,000 on a 3-ton heat pump. We apply every program you qualify for as an upfront discount.
What About the IRA Rebates (HEAR)?
The Inflation Reduction Act funded two programs. They're different from the 25C tax credit and did not end in 2025. They actually mostly got started in 2025 for Colorado.
HEAR (Home Electrification and Appliance Rebates) is funded through a separate pool of IRA dollars and was not affected by the One Big Beautiful Bill Act. It provides up to $8,000 for heat pumps (up to $14,000 for lower-income households) and is applied at point of sale, not on your tax return.
Status as of April 28, 2026: CLEAResult and the Colorado Energy Office confirmed that the HEAR Single-Family Program for Region 1 (Front Range) is now closed; project proposals submitted after April 27 will be denied. The state had already stopped reviewing new income verifications on April 17 unless an approved Project Proposal was on file. UniColorado is no longer including HEAR on new Front Range projects. Region 2 (all other Colorado counties) closed to new applications on August 1, 2026, so HEAR is now closed statewide. Full status on the HEAR page.
Active Rebate Programs in 2026
Up to $1,500/ton for cold-climate heat pumps. Available to Xcel gas customers.
Up to $8,000 for heat pumps while it was open. Income-qualified (under 150% AMI). Closed statewide: Front Range funds ran out April 28, 2026, and the rest of the state closed August 1, 2026.
$1,500 heat pump rebate, no income limit. Now available — the replacement for Front Range HEAR.
$1,000 upfront discount for all Colorado residents. No paperwork required.
Complete overview of every active program and how to stack them.
What Rebates Are Still Available?
The federal credit is gone, but Colorado still has significant heat pump rebates in 2026.
| Program | Rebate | Details |
|---|---|---|
| Xcel Energy | $1,500/heating ton | |
| Colorado State Tax Credit | $1,000 | |
| Power Ahead / DRCOG | $1,500 | |
| United Power | Varies | |
| EnergySmart | Varies | |
| Xcel IQ | 25-100% of cost | |
| Xcel Mountain Energy | $7,500/heating ton |
Available Rebate Programs
Explore these programs that are still active in 2026.
Stack Your Savings
Here's what stacking looks like for a typical 3-ton cold climate heat pump installation.
Income-qualified, Xcel customer (2026)
Based on a 3-ton cold climate heat pump. Actual savings vary by system size and eligibility.
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