Federal money for home energy upgrades is real, but it does not come automatically. The Inflation Reduction Act set aside $8.8 billion specifically for home energy rebates, split between two programs: the HOMES rebate program and the High-Efficiency Electric Home Rebate Act (HEEHRA), also called the HEAR program. As of early 2026, 23 states have live rebate programs running, and more are expected to launch before the funds expire in 2031. If you own a home and want to cut energy bills with upgrades like a heat pump, better insulation, or a new water heater, these rebates can cover a substantial portion of the cost.
What the IRA Home Rebate Programs Cover
The IRA created two distinct rebate programs for homeowners. They have different rules, different income requirements, and different ways of calculating the rebate amount. Understanding which one applies to you is the first step.
HOMES (Home Owner Managing Energy Savings) The HOMES program rewards measurable energy savings. You get a rebate based on how much energy your home saves after the upgrade, not just what you installed. The bigger the reduction in energy use, the bigger the rebate. This program is available to all income levels, though lower-income households get larger rebates.
HEAR (Home Electrification and Appliance Rebates) The HEAR program, sometimes called HEEHRA, targets low and moderate income households specifically. It provides upfront rebates on specific equipment and appliances. You do not need to calculate energy savings first. If your household income falls within the eligibility range, you can receive rebates on a defined list of electric upgrades.
HEAR Program Rebate Amounts
The HEAR program ties rebate amounts directly to income, measured as a percentage of your Area Median Income (AMI). AMI varies by county and household size, so two families with identical incomes can qualify for different amounts depending on where they live.
| Household Income Level | Rebate Amount |
|---|---|
| Below 80% of Area Median Income | Up to 100% of project cost |
| 80% to 150% of Area Median Income | Up to 50% of project cost |
| Above 150% of Area Median Income | Not eligible for HEAR |
The program caps rebates by equipment type. No matter how much the project costs, these are the maximum rebates available per item:
| Equipment or Upgrade | Maximum Rebate |
|---|---|
| Heat pump (space heating and cooling) | $8,000 |
| Heat pump water heater | $1,750 |
| Electric stove, cooktop, or range | $840 |
| Electric heat pump clothes dryer | $840 |
| Electrical panel upgrade | $4,000 |
| Insulation, air sealing, and ventilation | $1,600 |
| Wiring upgrades | $2,500 |
The total HEAR rebate across all upgrades is capped at $14,000 per household. If you are replacing multiple appliances in one project, you can stack rebates up to that ceiling.
HOMES Program Rebate Amounts
The HOMES program uses a performance-based calculation. Rebates are tied to how much energy your home saves, measured in terms of predicted or modeled energy reduction.
| Energy Savings | Standard Income Households | Low Income Households (Below 80% AMI) |
|---|---|---|
| 20% to 35% reduction | Up to $2,000 | Up to $4,000 |
| 35% or more reduction | Up to $4,000 | Up to $8,000 |
For multifamily buildings, the limits are calculated per dwelling unit. Low-income multifamily properties can receive up to $4,000 per unit for 20 to 35 percent savings and up to $8,000 per unit for 35 percent or more savings.
Unlike HEAR, the HOMES program does not restrict eligibility to specific income levels. Any homeowner can participate, though the rebate amounts are doubled for households at or below 80% AMI.
Which States Have Live Programs in 2026
IRA rebates are administered at the state level. The federal government allocated money to each state, and states set up their own application systems. As of early 2026, approximately 23 states have active programs accepting applications:
Arizona, California, Colorado, Connecticut, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Hampshire, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington, and Wisconsin.
Other states are in various stages of program development and are expected to launch in 2026. Florida and South Dakota declined their IRA allocations entirely and do not have programs. If your state is not listed above, check your state energy office website for the latest launch status, as new programs are coming online regularly.
Note for California residents: as of February 2026, HEEHRA single-family rebates in California are fully reserved and new applicants are being placed on a waitlist. The HOMES program through the state may have different availability.
What You Need to Apply
The application process varies by state, but most programs ask for similar documentation. Gather these before starting your application:
To verify income eligibility:
- Recent federal tax return (prior year)
- Pay stubs from the last 30 to 60 days
- Social Security or benefit award letters if applicable
- W-2 or 1099 forms
To verify your property:
- Proof of homeownership (mortgage statement or deed)
- Proof that the property is your primary residence
For the upgrade itself:
- Contractor quote or invoice showing equipment model number
- Energy Star certification or efficiency rating for the equipment
- Some states require a home energy assessment before qualifying for HOMES rebates
How to Apply: Step by Step
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Find your state program. Go to your state energy office website or search for "[your state] IRA home energy rebates." The U.S. Department of Energy maintains a state allocation page at energy.gov that links to each state's program.
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Check your AMI. Use the HUD income limits tool at huduser.gov to find your county's AMI. Compare your household income to the 80% and 150% thresholds to understand your rebate tier.
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Choose your upgrade. Decide which equipment you want to replace. If you qualify for HEAR, the heat pump and heat pump water heater typically offer the highest rebate values relative to cost.
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Get a qualified contractor. Most state programs require installation by a registered or certified contractor. Some states maintain a list of approved contractors on their program website. Do not purchase equipment before confirming contractor eligibility.
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Complete a home energy assessment if required. The HOMES program may require a pre-upgrade assessment to model your projected energy savings. Some states offer free or subsidized assessments.
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Submit your application. Apply through your state's program portal before or after installation, depending on your state's rules. Some states allow pre-approval before you start work; others process rebates after project completion.
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Receive your rebate. Rebates are typically issued as checks, direct deposits, or point-of-sale discounts applied directly at installation, depending on how your state set up the program.
Can You Combine IRA Rebates With Other Incentives?
Yes, in most cases. IRA rebates can be stacked with utility rebates, state incentive programs, and local efficiency programs. You generally cannot stack HOMES and HEAR on the same project for the same upgrade, but you may be able to use one IRA program alongside non-IRA incentives.
The Section 25C federal tax credit, which covered up to 30 percent of eligible home improvement costs up to $1,200 per year (plus $2,000 for heat pumps), was available through the end of 2025. Whether it continues into 2026 depends on Congressional action. Check IRS.gov for the current status of this credit when you file your taxes.
Separate from rebates, low-income households may also qualify for the Weatherization Assistance Program (WAP) through the Department of Energy, which provides free energy efficiency upgrades. WAP has different income limits and does not conflict with IRA rebate programs.
Program Funding Timeline
The HOMES and HEAR program funds are available until September 30, 2031, or until the allocated money runs out, whichever comes first. Some states, like California, have already seen their initial HEEHRA allocation fully reserved well ahead of that deadline. If you are in a state where the program is live, applying sooner reduces the risk of waiting on a depleted fund.
The Trump administration briefly froze IRA program funds through an executive order in early 2025, but federal courts ordered the funds reinstated. Legal challenges from several state attorneys general have continued, so the political environment around these programs remains unsettled. As of early 2026, funds are flowing and state programs are operating, but staying informed about your state's program status is worthwhile.
Who Benefits Most From These Programs
The HEAR program is designed to do the most for households with the least financial cushion. If your income is below 80% of your county's AMI, the program covers the full cost of installation up to the rebate cap. That means a qualifying household could replace an aging gas furnace with an electric heat pump for little to no out-of-pocket cost, cutting both energy bills and fossil fuel dependency in one project.
Moderate-income households between 80% and 150% AMI still benefit substantially. Covering half the cost of a heat pump installation, which typically runs $5,000 to $15,000 depending on system size and home configuration, is a meaningful savings even if it is not the full amount.
Higher-income homeowners above 150% AMI can still access the HOMES program if they are making substantial whole-home energy improvements that hit the 20% or 35% savings thresholds. The rebate amounts are smaller on a percentage basis but can still reduce the upfront cost of major retrofits.
Use the Benefits Screener
Not sure which programs apply to your situation? The Benefits Navigator screener can help you identify energy programs alongside other federal and state assistance you may qualify for. Visit /screener to check your eligibility across multiple programs at once.
Frequently Asked Questions
What is the IRA home energy rebate program?
The IRA home energy rebate program refers to two federal programs created by the 2022 Inflation Reduction Act: the HOMES (Home Owner Managing Energy Savings) program and the HEAR (Home Electrification and Appliance Rebates) program, also called HEEHRA. Together they provide up to $8.8 billion in rebates for home energy efficiency upgrades. Both programs are administered by individual states.
How much can I get from IRA energy rebates in 2026?
The amount depends on your income and which program you use. Under the HEAR program, households below 80% of Area Median Income can receive up to 100% of their project cost, capped at specific amounts per equipment type. The maximum HEAR rebate is $14,000 per household across all upgrades. The HOMES program can provide up to $4,000 for standard-income households or $8,000 for low-income households achieving 35% or more energy savings.
Do I have to pay income taxes on IRA energy rebates?
No. IRA home energy rebates are not taxable income. The rebate reduces your cost basis for the project, but you do not report it as income on your federal tax return.
Are IRA energy rebates available in my state?
As of early 2026, approximately 23 states have live programs. Check your state energy office website for current availability. Florida and South Dakota declined their federal allocations and do not have programs. Many other states are still in the process of launching.
Can I get a rebate if I rent my home?
The HEAR and HOMES programs are primarily designed for homeowners. Renters generally cannot apply directly, though some state programs allow landlords to apply for rentals occupied by qualifying tenants. Check your state's specific program rules.
What is the difference between the IRA rebate and the 25C tax credit?
The IRA rebates (HOMES and HEAR) come through your state's energy program and reduce your out-of-pocket cost at the time of the upgrade. The Section 25C tax credit was a federal income tax credit of up to 30% of eligible upgrade costs, with an annual cap of $1,200 (or $2,000 for heat pumps). The 25C credit was available through the end of 2025. Whether it continues in 2026 depends on current tax law. Check IRS.gov for updated guidance.
Does the IRA rebate cover solar panels?
No. The HEAR and HOMES programs do not cover rooftop solar installations. Solar panels are covered separately by the federal Investment Tax Credit (ITC), also called the Residential Clean Energy Credit, which provides a 30% tax credit for solar panel systems. That is a different incentive from the home energy rebate programs.
How long does it take to receive an IRA rebate?
Processing times vary by state and program administrator. Some states offer point-of-sale rebates applied at installation, so you never pay the full amount upfront. Others process claims after project completion and issue payment within a few weeks to a few months. Check your state program's website for current processing timelines.
What if my state's rebate funds are already depleted?
If your state's initial allocation has been reserved, you may be placed on a waitlist. States can also apply for additional allocations. While waiting, you may still qualify for utility rebates, state tax credits, or the Weatherization Assistance Program. Use our screener to check other energy-related benefits you may qualify for.
