Heat Pumps Can Help You Save on Home Cooling and Heating — and There's a Tax Credit for Installation

Heat pumps can save you serious cash with tax credits and energy efficiency, but they aren't for everyone.

Heat pump installed at the wall of a modern single-family house
(Image credit: Getty Images)

Heat pumps can keep your home cozy in the winter and — despite their name — cool your home efficiently in the summer. You can save up to $2,000 with federal tax credits by installing a heat pump, and some states and utilities provide additional incentives. But should you install a heat pump or make do with your current HVAC system? 

I talked to homeowners in cold climates like Maine to see if they effectively heat in the deep cold. And I was surprised to learn that some historic homes can stack heat pump incentives for a tidy tax credit or rebate. 

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Ellen Kennedy
Personal Finance Editor, Kiplinger.com

Ellen writes and edits personal finance stories, especially on credit cards and related products. She also covers the nexus between sustainability and personal finance. She was a manager and sustainability analyst at Calvert Investments for 15 years, focusing on climate change and consumer staples. She served on the sustainability councils of several Fortune 500 companies and led corporate engagements. Before joining Calvert, Ellen was a program officer for Winrock International, managing loans to alternative energy projects in Latin America. She earned a master’s from the U.C. Berkeley in international relations and Latin America.