Federal 25C credit: expired
The Energy Efficient Home Improvement Credit under 26 USC 25C provided up to $2,000 (30% of cost) for qualifying heat pump water heaters. It was enacted by the Inflation Reduction Act in August 2022.
The One Big Beautiful Bill Act (Public Law 119-21, signed July 4, 2025) accelerated the credit's termination from December 31, 2032 to December 31, 2025.
If you installed before December 31, 2025: You can still claim the credit on your 2025 tax return (filed in 2026) using IRS Form 5695. Keep receipts, the manufacturer's certification, and the QMID code.
If you install in 2026 or later: No federal tax credit is available for heat pump water heaters.
Sources: IRS.gov, 26 USC 25C
IRA HEAR rebates by state
The IRA Home Electrification and Appliance Rebates (HEAR, renamed High-Efficiency Electric Home Rebates by DOE in May 2026) are separate from the expired tax credit. They provide up to $1,750 for income-qualified households. Each state administers its own program on its own timeline. Since May 29, 2026, they only cover replacing an existing electric water heater (or new construction); replacing a gas, propane, or oil water heater no longer qualifies. DOE Program Notice 26-2.
| State | HEAR Status | Verified |
|---|---|---|
| Alaska | Not launched | 2026-11-01 |
| Alabama | Not launched | 2026-11-01 |
| Arkansas | Not launched | 2026-11-01 |
| Arizona | Launched | 2026-11-01 |
| California | Launched (paused) | 2026-11-01 |
| Colorado | Launched (paused) | 2026-11-01 |
| Connecticut | Not launched | 2026-11-01 |
| District of Columbia | Launched | 2026-11-01 |
| Delaware | Not launched | 2026-11-01 |
| Florida | Not launched | 2026-11-01 |
| Georgia | Launched (no HPWH rebate) | 2026-11-01 |
| Hawaii | Not launched | 2026-11-01 |
| Iowa | Not launched | 2026-11-01 |
| Idaho | Not launched | 2026-11-01 |
| Illinois | Not launched | 2026-11-01 |
| Indiana | Launched | 2026-11-01 |
| Kansas | Not launched | 2026-11-01 |
| Kentucky | Not launched | 2026-11-01 |
| Louisiana | Not launched | 2026-11-01 |
| Massachusetts | Not launched | 2026-11-01 |
| Maryland | Not launched | 2026-11-01 |
| Maine | Launched (no HPWH rebate) | 2026-11-01 |
| Michigan | Launched | 2026-11-01 |
| Minnesota | Not launched | 2026-11-01 |
| Missouri | Not launched | 2026-11-01 |
| Mississippi | Not launched | 2026-03-12 |
| Montana | Not launched | 2026-11-01 |
| North Carolina | Launched | 2026-11-01 |
| North Dakota | Not launched | 2026-11-01 |
| Nebraska | Not launched | 2026-11-01 |
| New Hampshire | Not launched | 2026-03-12 |
| New Jersey | Not launched | 2026-11-01 |
| New Mexico | Launched (no HPWH rebate) | 2026-11-01 |
| Nevada | Not launched | 2026-11-01 |
| New York | Launched | 2026-03-12 |
| Ohio | Not launched | 2026-03-12 |
| Oklahoma | Not launched | 2026-11-01 |
| Oregon | Not launched | 2026-11-01 |
| Pennsylvania | Not launched | 2026-11-01 |
| Rhode Island | Launched (no HPWH rebate) | 2026-11-01 |
| South Carolina | Not launched | 2026-11-01 |
| South Dakota | Declined | 2026-11-01 |
| Tennessee | Not launched | 2026-11-01 |
| Texas | Not launched | 2026-11-01 |
| Utah | Not launched | 2026-11-01 |
| Virginia | Not launched | 2026-11-01 |
| Vermont | Not launched | 2026-11-01 |
| Washington | Not launched | 2026-11-01 |
| Wisconsin | Launched | 2026-11-01 |
| West Virginia | Launched | 2026-11-01 |
| Wyoming | Not launched | 2026-11-01 |
Source: DOE Home Energy Rebates. Verification dates shown per state.
Active state and utility rebates
These programs are separate from the expired federal tax credit. Amounts and eligibility vary. Verify at the program website before applying.
| State | Amount | Program |
|---|---|---|
| Alabama | $600 when switching from a gas water heater | Alabama Power |
| Arkansas | Up to $500 instant discount | Entergy Arkansas |
| Arizona | $500 | Salt River Project |
| Arizona | $400 bill credit | Tucson Electric Power (TEP) |
| California | $3,000-$4,000 gas-to-electric (by tank size); $1,000 electric-to-electric | Sacramento Municipal Utility District (SMUD) |
| Colorado | $750 standard; plus $1,500 limited-time bonus (up to $2,250) | Xcel Energy |
| Colorado | $83 minimum customer discount ($250 credit to contractor) | Colorado Energy Office / Colorado Department of Revenue |
| Connecticut | $900 | Eversource / United Illuminating (Energize CT) |
| District of Columbia | $750-$1,000 electric-to-electric; $1,200-$1,600 gas-to-electric | DC Sustainable Energy Utility (DCSEU) |
| Delaware | $500-$750 | Energize Delaware / Delaware Sustainable Energy Utility |
| Delaware | $300 | Delaware Electric Cooperative |
| Florida | $500 (50-gallon) / $800 (80-gallon) | Duke Energy Florida |
| Georgia | Up to $800 | Georgia Power |
| Hawaii | $500 (40-54 gal) / $700 (55-82 gal) | Hawaii Energy (ratepayer-funded, administered by Leidos) |
| Iowa | $225 | MidAmerican Energy / Alliant Energy |
| Idaho | $300 | Idaho Power |
| Illinois | Ameren Illinois: $800 rebate or $1,150 contractor instant discount. ComEd: contractor instant discount (amount not posted) | Ameren Illinois / ComEd |
| Indiana | $350-$600 (AES Indiana $600; Duke Energy Indiana about $350) | Various utilities (AES Indiana, Duke Energy Indiana, Indiana Michigan Power, NIPSCO, CenterPoint) |
| Louisiana | Up to $400 | Entergy Louisiana (Entergy Solutions) |
| Massachusetts | $750 per unit (standard/120V); $1,500 per split system | Mass Save (Eversource, National Grid, Unitil, Berkshire Gas, Cape Light Compact, Liberty) |