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If you plan to install a new heating, ventilation, and air conditioning (HVAC) system, or if you are considering an upgrade, we have good news. Virginia residents may be eligible to receive valuable tax credits and select rebates on qualifying HVAC systems.
When Congress passed the Inflation Reduction Act of 2022, two new rebate programs became available to American taxpayers. We’re going to explain the Home Efficiency Rebate program, which offers tax credits of up to $2,000 for qualified HVAC systems. There are also rebates offered by Virginia utility companies that you may be able to combine with the tax credit.
Understanding the Home Efficiency Rebate Program
Virginia homeowners can qualify for a substantial federal tax credit when installing eligible HVAC systems. The credit amount is up to $2,000 or 30% of the installation cost, whichever is lower. Since this is a tax credit available from the Internal Revenue Service (IRS), it directly reduces your tax liability.
Let’s say you owe $2,000 after filing your annual tax return; in this case, the Home Efficiency Rebate could offset the debt. To claim this credit, you must file IRS Form 5695 along with your federal tax return.
HVAC Systems Eligible for Rebate Programs
According to the Energy Information Administration, one-third of Virginia households have ductless mini-split and heat pump systems. After solar panels, ductless cooling and new heating systems are the most commonly installed as part of the Home Efficiency Rebate program. This high adoption rate and eligibility for rebates are based on the energy efficiency benefits delivered by these systems.
Mini-splits and heat pumps are renowned for their energy efficiency. They operate by transferring heat rather than generating it, thus making them more efficient than central HVAC systems. This high efficiency translates into lower energy consumption and lower utility bills.
Energy-saving technologies are at the heart of the various incentives provided by the Inflation Reduction Act. The reduced energy use of ductless systems contributes to a smaller carbon footprint. Lowering overall energy consumption and greenhouse gas emissions are among the primary goals of the IRS tax rebate.
While the IRS Home Efficiency Rebate helps to offset the up-front costs of HVAC system conversions, upgrades, or installation, the long-term savings are more substantial. Beyond the monthly savings, modern ductless systems provide targeted cooling and heating through smart zoning. Mini-splits and heat pumps allow you to control the temperature in individual rooms or zones. This zoning strategy avoids wasting energy in heating or cooling unoccupied spaces.
Mini-split installation also offers improved comfort compared to central HVAC systems. They provide consistent temperatures while eliminating hot and cold spots. Many of the mini-split and heat pump models from top brands such as Lennox and American Standard have special filtration features. These systems are equipped with advanced air filters that catch airborne particles such as dust, pollen, pet dander, and spores. The lack of ductwork promotes indoor air quality because dust, allergens, and other pollutants don’t accumulate in the duct sections.
Financial Incentives Available From Dominion Energy
The WeatherSmart program managed by Dominion Energy offered rebates on thermostat purchases and up to $50 in annual cash rewards. In late 2024, the program stopped accepting new thermostat enrollments and was replaced by the new EnergyShare initiative. This new program provides up to $600 in bill payment assistance to Hampton Roads homeowners.
EnergyShare runs from October through May. The program is open to all Dominion Energy subscribers, and it covers various heating and cooling systems, including electricity and fuel. When you sign up, the first benefit is a free home energy assessment along with weatherization services. In some cases, customers participating in EnergyShare can get insulation upgrades from the utility company.
To apply for EnergyShare assistance, visit the Dominion Energy website or dial 2-1-1 to get more information. The application process involves completing a form and providing documentation to verify eligibility.
Contact Us for More Information About HVAC Savings
Since 1964, Simmons Heating & Cooling has been serving the HVAC needs of homeowners in Chesapeake and other cities in the Hampton Roads metropolitan area. What started as a one-man operation expanded into a larger family-owned and operated HVAC company over the decades. Some of our technicians started working with us while they were high school students on summer vacation and then became full-time employees upon graduating from college. Our accreditation with the Better Business Bureau goes back four decades, and we have proudly maintained an A+ rating since.
For any questions about HVAC tax rebates, or to get a service estimate, contact Simmons Heating & Cooling today.
