Last Chance for 25C Energy Efficient Home Improvement Credit

August 1, 2025

By Pika Team

If you've been thinking about upgrading your home's HVAC system, 2025 is the year to make your move. The Energy Efficient Home Improvement Credit (IRA 25C Tax Credit) is sunsetting sooner than expected, and there are some important new rules you'll need to know to make sure you get every dollar you're eligible for.

Here's a quick breakdown of what's changing, what's new for 2025, and how to claim your credit without leaving money on the table.

What's Changing with the 25C Credit?

Congress passed HR1, "The One Big Beautiful Bill Act," on July 4, 2025, and it came with some big updates for homeowners looking to save on energy-efficient upgrades.

  • The 25C Energy Efficient Home Improvement Credit will end December 31, 2025.
    If you're thinking about replacing your heat pump, furnace, central AC, or boiler, you need to buy and install your system before that date to qualify.

  • After 2025, the credit disappears for most residential HVAC systems.

💡 Pro tip: If your system is on its last leg, 2025 is the perfect time to upgrade. You can stack and save with rebates, local incentives, and the 25C tax credit—but only through the end of the year.

What's New for 2025: The PIN Requirement

Starting with 2025 tax filings, the IRS now requires a Product Identification Number (PIN) for every qualifying HVAC system.

Here's how it works:

  • Enter the PIN on IRS Form 5695 (Residential Energy Credits) when you file your federal taxes.

  • No PIN = No Credit. Even if your system qualifies, the IRS will reject your claim without the correct code.

So, make sure you keep this PIN with your tax records when you upgrade your HVAC system.

Which HVAC Products Qualify for the 25C Credit?

Eligible Systems:

  • Heat pumps
  • Central air conditioners
  • Furnaces & boilers
  • Certain high-efficiency HVAC upgrades

Credit Amounts:

  • Up to $2,000 per year for heat pumps and biomass systems
  • Up to $1,200 per year for other improvements

Who's Eligible:

  • Upgrades must be made to your primary residence in the U.S.
  • Credit does not apply to new construction

Next Steps for Homeowners

If you want to maximize your savings:

  1. Upgrade Before December 31, 2025.
    Don't wait—once the deadline passes, the 25C credit is gone.

  2. Choose Qualified Products.
    Make sure your HVAC system comes from an IRS-recognized manufacturer and has a valid PIN.

  3. Keep the PIN for Tax Time.
    Enter it on IRS Form 5695 to claim your credit.

Between rebates, local utility incentives, and the 25C Energy Efficient Home Improvement Credit, homeowners can still lock in thousands in savings—but the window is closing fast.