Heat pumps have so far withstood the death of federal tax credits

Heat pumps are still selling well even though the federal tax credit for them is gone. A recent industry report found that heat pump shipments held strong through the first half of 2026 and are on pace to match or beat the technology's best year yet. Heat pumps are devices that both heat and cool a home, often replacing a gas furnace and an air conditioner with one electric system.

The tax credit in question, known as 25C, used to knock up to $2,000 off the cost of a heat pump. It expired at the end of 2025, seven years ahead of the original schedule, after Republicans in Congress and President Trump eliminated it along with incentives for solar panels and batteries. Despite that, demand hasn't dropped off. One researcher suggests most buyers never relied on the credit in the first place, since factors like local climate and electricity prices tend to matter more, and often it was contractors mentioning the credit to customers rather than the other way around.

Some state and utility programs still offer their own incentives for heat pumps, and local governments in some areas continue to push policies encouraging a switch away from gas. If you're weighing a heat pump for your own home, it's worth checking what your state or utility currently offers, since availability varies by location. Not every clean-energy technology has fared as well without federal support — solar panel installers and electric vehicle sales have both struggled since their tax credits ended.