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HVAC Resources

Government Rebates for Air Conditioning and Heating

Explore new federal energy guidelines for 2023 and learn about HVAC rebates and energy-efficient incentive program aimed toward homeowners.

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Year-round, your home’s HVAC has to work properly in order to keep temperatures comfortable. And that high level of performance can come at a cost. But there are options out there to help foot the bill. Throughout the country, there are different government air conditioning rebates and incentive programs available aimed toward helping homeowners like you lead their house into efficiency. Do you qualify for an HVAC rebate? Find out below by exploring links to the right government programs.

Please be aware: Modernize Home Services cannot guarantee that the HVAC contractors in our network will honor government rebates and grants as a form of payment toward your project. We recommend discussing your budget and payment options with your contractor at the time you receive your quote.

2024 Government Rebates for HVAC Replacements

The terms and conditions of government rebates or grants can differ depending on the time of year, location and other variables. Modernize recommends checking with the Database of State Incentives for Renewables & Efficiency to see if you’re eligible before applying or hiring a contractor. This maximizes your chances of securing the funds, and it also gives your contractor all the info they need before the project starts.

  • New Federal Rebate Program: Many Americans will save thousands of dollars on home renovations when new rebates for a range of energy-efficient upgrades kick in later this year as part of a $9 billion federal program passed by Congress in last summer’s Inflation Reduction Act. The size of the rebates will vary based on your household income and where you live, since the program will be administered separately by each state. These rebates can also be stacked on top of existing tax credits and utility offers for heat pumps, solar, and EVs. The new rebate programs and enhanced tax credits are good through 2032.
  • HVAC rebates may be available to homeowners who switch from electric to natural gas furnaces, air conditioning units, and water heaters. There are certain equipment requirements that have to be met in order to obtain rebates. 
  • Start with a Home-Energy Audit: A recommended first step homeowners can take toward increasing energy efficiency and electrification is a home-energy audit. Getting one will be a requirement for the new rebate program for cutting overall energy use. The Internal Revenue Service (IRS) issued guidance specifying that the audit must identify the most significant and cost-effective energy-efficiency improvements, including an estimate of the energy and cost savings to each improvement. Taxpayers can get a $150 tax credit for a $500 audit.
  • Use Apps to Help Crunch the Numbers: Pearl Certification’s Green Door app guides homeowners through high-performance renovations, from picking a contractor to searching for rebates based on your home’s address. Rewiring America has an Inflation Reduction Act calculator that lets you plug in your family income and ZIP Code. It also produces a list of available upfront rebates and tax credits.

ENERGY STAR Rebates 

This program — which is run by the U.S. Environmental Protection Agency (EPA) and U.S. Department of Energy (DOE) to promote energy efficiency — offers rebates and special offers based on a homeowner’s location. Find out if you’re eligible for savings by visiting ENERGY STAR’s Rebate Finder

HVAC Replacement Cost Calculator

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The Residential Energy Efficient Property Credit

As noted by the IRS, there are a number of incentives offered by the federal government in exchange for making your home energy efficient. Homeowners should consult with their contractor for more insight on projects that are eligible for tax credits. For more information, visit the IRS’s page on energy incentives

U.S. Department of Agriculture (USDA) Programs and Grants

The USDA offers funding to help low-income families secure housing as well as for home repairs and preservation. Homeowners can contact their local representative or RD State office for more information. 

Weatherization Assistance Program

This program is offered by the U.S. DOE to help low-income families increase their home’s energy efficiency and in turn, reduce energy costs. It covers cleaning, tuning, repairing or replacing a house’s heating and/or cooling systems. The program also notes that by weatherizing a house with the department’s assistance, the home’s “energy burden” is in turn alleviated since the home can become better insulated, sealed and ventilated. More information on the program is available through this fact sheet. To apply, contact your state weatherization agency

Find the Right Contractor for Your HVAC Project

Whether you’re ready to begin your project now or need some expert advice, our network of contractors are here to help. With a few simple questions, we’ll find the best local professionals for you

Housing Improvement Program 

An incentive offered by the U.S. Bureau of Indian Affairs (BIA), this program offers home repair assistance to eligible low-income American Indian and Alaska Native families. Interested homeowners can apply by filling out BIA Form 6407 with their closest housing office. 

Air Conditioning Size Calculator

Ready to find out how big your AC unit should be so you can start researching and budgeting your options? Click here!

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Alternatives to a 2024 Government HVAC Rebate 

Because of its limited availability and competitive nature, not everyone is able to secure an HVAC rebate. But that doesn’t mean you’re out of options. Alternatives like a small home improvement loan or opting for a 0% APR credit card can help fund that important air conditioning project. Here are some options:

Manufacturer or Energy Provider Rebates 

Though you might not be able to secure a rebate from the government, your air conditioning supplier might have one of its own. In many cases, product manufacturers will offer its own product rebate to contractors. In addition, high-efficiency air conditioning products are sometimes eligible for rebates through local energy providers. Check with the DOE’s rebate finder for more information. 

Home Improvement Loan 

A home improvement loan can help homeowners secure the funds necessary to complete a project without accumulating credit card debt. Of course, there are still things to consider, including if your financial stability will allow you to secure one and the amount of time it will take for funds to become available. 

A 0% APR Credit Card

As previously noted by Modernize, this option is beneficial for making big purchases — such as a new air conditioning system — without additional interest, so long as you pay off your balance before the introductory rate expires. Multiple banks offer different variations of a 0% APR credit card. Modernize recommends comparing the introductory rate’s length and the interest rate that will follow. 

Local Government Loans or Incentives 

Depending on where you live, different states, cities, and counties offer incentives or subsidized loans geared toward building maintenance. In Austin, Texas, for instance, local energy company Austin Energy offers a database of available rebates and incentives for energy-efficient air conditioning systems. You can see if your area is offering something similar by visiting your local government’s website or calling your county’s office.

Find the Right Contractor for Your HVAC Project

Whether you’re ready to begin your project now or need some expert advice, our network of contractors are here to help. With a few simple questions, we’ll find the best local professionals for you