Short answer
In 2026, the most dependable incentive for a new heat pump is the federal 25C tax credit (up to 30% of cost, capped at $2,000/year for qualifying heat pumps). California's statewide heat-pump rebate is largely waitlisted, so don't count on it to close the deal. If incentives aren't open, financing or Rent-or-Buy can bridge the gap.
The federal 25C tax credit (the reliable one)
The federal Energy Efficient Home Improvement Credit — commonly called 25C — rewards homeowners for installing qualifying efficient equipment. For a heat pump, that's a credit of up to 30% of the project cost, capped at $2,000 per year. Other upgrades have their own smaller caps (for example, high-efficiency central AC and furnaces).
Two things to keep straight: it's a tax credit, claimed when you file, not an instant rebate at purchase — and eligibility depends on the equipment meeting efficiency requirements. Confirm the numbers for your situation with a tax professional before you assume them.
California's statewide heat-pump rebate: waitlisted
California has invested heavily in getting homes onto electric heat pumps through programs like TECH Clean California and the federal Home Energy Rebates the state is administering. The catch in 2026: demand has outstripped funding, and much of it is currently waitlisted or paused. We won't promise you a statewide rebate that isn't open — instead we confirm what's live the week you're deciding. [GATHER: confirm current statewide program status + links at quote time.]
Utility rebates
Your electric or gas utility may run its own rebates on high-efficiency equipment, but amounts and eligibility shift through the year and depend on which utility serves your address. We check current offers when we build your quote rather than quoting a number that may have expired. [GATHER: confirm serving utility + current rebate amounts per address.]
When incentives aren't open: financing & Rent-or-Buy
Comfort emergencies don't wait for a rebate window. If nothing is open when your system fails, you can still move forward affordably:
- Financing spreads the cost into predictable monthly payments.
- Rent-or-Buy turns a major purchase into a low monthly subscription with service included — useful when a big upfront bill isn't realistic.
Either way, we'll show you the honest math so you can compare paying cash, financing, or renting — and fold in any credit you actually qualify for.