FAQ

  • IRA FAQs

    • What is the Inflation Reduction Act (IRA)?
      To help reduce inflation, decrease carbon emissions, and more, the U.S. Government has passed the Inflation Reduction Act (IRA), which includes several tax credits for installing ENERGY STAR® certified home heating and cooling products. The IRA consists of rebates and tax credits for HVAC.
    • What is the difference between IRA rebates and tax credit offerings?

      There are two rebate programs available. Rebates are administered at the state level and favor lower-income households. Federally funded rebates cannot be combined and are intended for immediate, point-of-sale benefit.

      There are four tax credits available. Tax credits are federal income tax credits available to anyone with taxable income. Tax credits can be combined, and rebates can be filed for the following calendar/tax year.

    • What are the tax credits included in the Inflation Reduction Act?
      • Tax Section 25C: Nonbusiness Energy Property Credit
      • Provides a tax credit to homeowners equal to 30% of installation costs for the highest efficiency tier products, up to a maximum of $600 for qualified air conditioners and furnaces and a maximum of $2,000 for qualified heat pumps.
      • Tax section 25D: Residential Energy Efficient Property
      • Provides a tax credit to homeowners equal to 30% of installation costs for ENERGY STAR® geothermal heat pumps until 2032. That percentage drops to 26% in 2033 and 22% in 2034.
      • Tax Section 45L: New Energy Efficient Home Credit
      • Provides tax credits to builders for meeting specific energy-saving criteria. The tax credits for ENERGY STAR 3.1 certified housing are $2,500 for single-family homes and $500 for multi-family units. To meet the Department of Energy’s Zero Energy Ready requirements, the tax credit increases to $5,000 for single-family and $1,000 for multi-family residences. If prevailing wage requirements are met on multi-family construction, those credits increase to $2,500 and $5,000
      • Tax Section 179D: Commercial Buildings Energy-Efficiency Tax Deduction
      • Provides a tax deduction for building owners to claim for installing qualifying systems in buildings.
      • Up to $14,000 maximum for all.
    • What are the rebates included in the IRA?
      • High-Efficiency Electric Home Rebate Program
      • Provides income-depending rebates to low to moderate-income (LMI) homeowners, including:
        • Up to $8,000 for all-electric heat pumps
        • Up to $4,000 for electrical load service center
        • Up to $2,500 for electric wiring
      • HOMES Rebate
      • Provides rebates for energy efficiency upgrades that improve a single-family homes or multi-family building’s overall energy performance.
    • How should dealers leverage this opportunity?
      Research the potential tax credits available, the efficiency requirements to earn the credit and the products that meet those criteria. Then, communicate those potential incentives in every sales presentation.
    • Do the IRA savings apply to installations done in 2020 and 2021?
      No.
    • What is CEE?
      The Consortium for Energy Efficiency (CEE) is an award-winning non-profit comprised of U.S. and Canadian energy efficiency administrators working together to accelerate the development and availability of energy-efficient products and services. CEE harmonizes program approaches in North America by supporting the production and market adoption of energy-efficient and connected equipment, installation and maintenance guidance, and facilitating program opportunities for each unique customer.
    • What are the CEE specifications and tiers?

      The CEE equipment specifications for air conditioners, heat pumps and furnaces can be found at the following links. Currently, the direction is that the IRS will require eligibility for 25C to adhere to the highest tier below the Advanced tier for each product. It is still unclear whether the IRS will include regional distinctions, North versus South.

      The highest tier refers to the tier below the “Advanced Tier” with “Tier 1” being the lowest tier if there are multiple tiers listed.

    • Is CEE the same as NEEP?
      No.
    • In regard to CEE, what about the equipment?
      Only M1-rated equipment is applicable.
    • What is LMI?
      Low-to-Moderate Income (LMI) based on the area median income (AMI).
    • How is LMI determined and who makes that determination?
      LMI is determined at the various levels (state, city, county level). Please refer to your local municipal office for information about your area.
    • Does a list of LMI by state exist?
      LMI is determined at various levels (state, city, county level). Please refer to your local municipal office for information about your area.
    • Do you have a breakdown on what tax credit the homeowner will receive based on income?
      Please refer to the TM Webinar Deck for a breakdown of the income levels required for rebate qualification.
    • What constitutes a cold climate heat pump?
      The performance requirements for Energy Star and cold climate heat pumps can be found here.
    • Do the heat pump and furnace count for 25C – $2,600 credit, or is it capped at $2,000?
      Our understanding is that if both units meet the criteria, both items can be claimed. Please consult with your tax professional for more information.
    • Is there a lifetime cap for a homeowner on this funding?
      25C does not have a lifetime cap, but the program expires in 2032.
    • Do dealers need to provide a complete job breakdown for equipment, material, labor/install?
      We are not aware of the documentation that will be required for filing. Please consult your tax professional for more information.
    • Where does the money for 25C come from?
      25C is a federal tax credit. The rebate programs, though funded at the Federal level, are administered at the state level, and are funded separately from the IRA in the amount of $4.3 billion for both rebates.
    • Is the 25C a $3,200, one-time cap, or is it a yearly cap?
      There is no lifetime cap, but there is an annual cap of $1,200 for qualifying products and a separate annual cap of $2,000 for heat pumps. If combining a heat pump with other qualifying products, a homeowner could receive up to $3,200. Please consult your tax professional for more information.
    • Is the tax credit based on a system combo installation? Can you qualify with just a heat pump only installation?
      The IRS intends for a qualifying system. If the IRS requires an AHRI certification number, then a heat pump installed would have to be installed on a system combination that meets the requirements. However, we do not know what the IRS will require upon filing.
    • Does AHRI state if a match-up is eligible for tax credit?
      AHRI has not updated their site to match the 2023 tax requirements or the Energy Star 6.1 requirements.
    • What rating do we use if there is mixed equipment? For example, 2022 indoor unites with new 2023 heat pumps?
      All of the requirements for 2023 installations reference M1 ratings. There currently isn’t any direction regarding M-rated equipment.
    • How does the new IRA tax credit work in homes with multiple systems?
      Regardless of the number of systems, the taxpayer is limited by the annual limit. Replacement of one system would likely meet the annual limit so to maximize the tax benefit, they should subsequent systems in later years.
    • Can Federal rebates be combined with state rebates like NYS clean heat?
      Federal rebates cannot be combined with any other federally funded rebate program included in the IRA. We are unaware of any restrictions for other non-IRA programs.
    • Will dealers have to require financial records at point-of-sale?
      We do not know this information at this time.
    • How are our dealers supposed to administer a POS rebate without verifying household income?
      We do not know this information at this time; each state will determine this process.
    • Are contractors expected to float thousands of dollars on the sales until funded by the state government?
      We do not know this information at this time; each state will determine this process.
    • Are tax credits retroactive to 2022? Would 2022 installations apply similarly on an existing program?
      2022 installations that qualified based on the 2022 criteria can be filed for tax credit in the 2023 tax year. Qualified installations occurring in 2023 need to meet the 2023 criteria and would be included in the household’s 2024 tax filings. Please consult your tax professional for more information.
    • Is there any indication from the IRS that there will be a lifetime limit on payouts under the Inflation Reduction Act?
      Please consult your tax professional for more information regarding filing separate claims on multiple systems/homes owned by the consumer.

  • Generator FAQs

    • Where will the generator be located?
      Each City/Township/Municipality has its own requirements for where a generator may be placed. Many do not allow generators to be placed on the side of the house. Many have minimum distances to the property line or to the neighbor’s house. All of them allow for backyard locations, so that should be your first choice. You could also call your local building department and ask them the requirements.
    • What if I have an HOA?
      Many HOAs have tighter restrictions on generators than the local building department. We don’t work with HOAs. If you have an HOA, it will be up to you to make sure that you fulfill their requirements for a standby generator. If, after installation, the HOA does not want the generator where the city approved it, we will not accept any responsibility for moving the generator. The safest choice is to contact your HOA before a salesperson even arrives at your home. That way, he can help find a suitable location.
    • Is my gas meter big enough?
      Even small generators use a lot of gas and our experience is that your gas meter will need to be changed. The utility generally charges a few hundred dollars for this depending on the size you need. Our salespeople have a form that will help you work with the utility. About twice a year one of our customers discovers that the gas line from the house to the street is too small and will need to be replaced along with the meter in order to accommodate a generator. These are always DTE gas customers. The cost for this starts at about $2,000, and we have seen it as high as $9,000. We understand that this could be beyond what you budgeted, and we will refund your deposit 100% if you need us to.
    • Will I lose power during installation?
      Yes. Plan to be without power for six hours, until the installation team gives you a different time frame. They try to be quick since they don’t like working in the dark either, but each situation is different.
    • What about inspections?

      We pull permits on all our jobs, which means that your local electrical and mechanical inspector will come behind us to make sure

      everything is up to code. Keep in mind that these inspectors don’t work for us. They work for you. They will not tell us what time they will be at your home. If you call the building department, they may or may not give you some kind of window to help you plan your day. Its best to plan to be home from 8am until the last inspector shows up.

    • Do you keep generators in stock?
      Yes. We are fortunate to be able to stock dozens of generators and transfer switches in our warehouse, and each month we reorder everything we used last month. However, demand has been very high, and Generac struggled to keep up during 2020 and 2021. Things normalized early 2022 and we hope that will continue.
    • What circuits should I put on my generator?
      If you won’t be putting your entire home on the generator, we recommend at least the following. Refrigerator, Freezer, Garage door opener, Sump Pump, Well Pump, Furnace, Microwave. If you have a power vented or tankless water heater that would be a good choice also. Take some time to walk through the house and think about the most common things you use (TV, Internet Router, Hair Dryer, Etc.). Write them down and discuss it with your salesperson and install crew.
    • My air conditioner is on interruptible service. Will it work?
      If you have two electric meters, you may have an interruptible air conditioner. It will not work while the generator is powering the house unless we do one of the following. 1) Remove the interruptible service and wire the air conditioner into the electric panel which will cause you to lose the discount on your electric bill or, 2) install a second transfer switch for the air conditioner and you will keep your discount.
    • How long does the installation take?
      There are a number of factors that determine the time an installation takes. Some of these factors are out of your control, like if we need to run all the gas and electric through a crawl space or an attic. However, some factors are within your control. Before the team arrives, consider the following questions: Does the team have room to work? Are the stairs cleared? How much time will you spend talking to them? Most jobs get done in one day. Big, complicated jobs often take a second day.
    • What kind of maintenance does the generator require?

      Six months after installation the “Break–in” oil that ships with the generator needs to be changed along with the oil filter. After that, each year or 100 hours of run time,

      maintenance should be done where the oil, oil filter, air filter and spark plugs get replaced and the battery tested. Nearly two thousand of our customers hire us to do that for them each year, or you can do it yourself. Be advised, Generac may ask for maintenance records when a warranty claim is submitted.

    • My electric panel is recessed into the wall. Does that matter?
      The cable going from your electric meter to your electric panel will need to be removed and replaced. That cannot be accomplished without cutting back the drywall. We try to do it as neatly as possible, but we don’t repair any of the drywall we have to cut out.
    • Do I need to be home during the installation?
      We need someone over eighteen in the home. Especially near the end of the installation when we offer instruction on how the system operates. You will also want to make sure everything in your home has power while the generator is powering the house.
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