The $2,000 federal heat pump credit
is gone.
25C expired December 31, 2025, and so did 25D. Here's exactly what replaced them and what federal programs still apply in 2026.
What happened to the federal heat pump tax credit?
The 25C credit that paid up to $2,000/year for heat pumps was repealed by the One Big Beautiful Bill Act in July 2025 and expired December 31, 2025. As of 2026, there is no federal tax credit for air-source heat pumps. State and utility rebates are now the only rebate path. The 25D credit for solar, battery storage and geothermal heat pumps ended on the same date.
What OBBBA killed
The One Big Beautiful Bill Act (OBBBA), signed July 2025, moved up the end dates of the Inflation Reduction Act's residential clean-energy credits. Two residential credits expired on December 31, 2025 and do not apply to 2026 installations, and a commercial deduction ends in 2026:
- 25C Energy Efficient Home Improvement Credit — $2,000/yr cap for heat pumps, heat pump water heaters, biomass stoves. Gone.
- 25D Residential Clean Energy Credit (owned solar, battery storage, geothermal heat pumps) — 30% of owned system cost. Gone for owned systems.
- 179D Energy Efficient Commercial Buildings Deduction — ends for property whose construction begins after June 30, 2026.
What survived
Not everything. A few federal incentives still apply in 2026:
- 48E commercial ITC (third-party-owned solar and batteries) — claimed by the company that owns the system, which is how a solar lease or PPA still carries a federal credit. For solar it ends for systems placed in service after December 31, 2027, unless construction began by July 4, 2026. Battery storage is not subject to that solar and wind cutoff.
- HEEHRA (IRA rebates, not credits) — already appropriated, now administered state-by-state. Up to $14,000/household. See the state map.
Why state + utility rebates matter more now
Before OBBBA, the federal 25C credit was the headline. State and utility incentives were a bonus. The math has inverted.
In Massachusetts in 2026, an income-qualified household stacking HEEHRA ($8,000) + Mass Save rebates (up to $10,000) + MOR-EV/utility-specific bonuses walks out with a larger total incentive than 25C ever delivered — even before accounting for the fact that 25C was a tax credit (needed tax liability) while HEEHRA is a direct rebate.
The catch: HEEHRA has launched in only a handful of states. The rest are stuck in DOE approval queues. The state-by-state status map tells you exactly where your rebate stack is real versus theoretical.
Find what actually applies
Enter your ZIP to see the stacked rebates that replaced 25C in your state.
Where 25C went, what to do now
OBBBA timeline, remaining federal items, and how to sequence stacking without the dead tax credit.
Your state rebate stack is live.
Find every program that applies — federal, state, utility — in one lookup.