The Inflation Reduction Act creates 9 billion reasons for homeowners to improve their home’s energy efficiency, but your clients may not be clear on what projects they want to focus on or how to get started. Set yourself apart from the competition by serving as your customers’ guide to the IRA.

Know Your Business

Thankfully, you don’t have to know all aspects of the IRA, just the parts that pertain to your business. If you’re in the HVAC business, you need to understand the Energy Efficient Home Improvement Tax Credit (25C). Explain to your customers that this tax credit, which is available now, applies to up to 30% of qualifying energy-efficiency projects costs up to $1,200 per year. The maximum increases to $2,000 for heat pumps.

If your state chooses to implement them, the High-Efficiency Electric Home Rebate Act (HEEHRA) and Homeowner Managing Energy Savings (HOMES) rebate programs will be a great resource to help your customers lower the cost of their energy upgrades. These rebates are not available yet but Pearl is tracking their progress and will update our network contractors as soon as we know more.

Solar contractors, on the other hand, should understand the Residential Clean Energy Property Tax Credit (25D), as well as the Energy Efficient Home Improvement tax credit (25C). Granted 25C doesn’t impact solar installations directly, but tax credits available through 25C can positively impact solar contractors’ packages that reduce energy. Thanks to 25D, battery storage is now an eligible expenditure for tax credits. Solar contractors should also inform their customers that the 25D tax credit covers 30% of their project starting now, but coverage decreases to 26% in 2033 and again to 22% in 2034.

Upsell Opportunities

By understanding the IRA tax credits and rebates applicable to your business, you can help your customers select home improvements based on the incentives available to each unique customer. For example, where the HOMES rebate will apply to all homeowners, the High Efficiency Electrified Homes rebate (HEEHRA) will only apply to families at or below 150% area median income. Granted the rebates are not yet available, so capitalizing on these opportunities is dependent on your state choosing to implement them.

The Energy Efficient Home Improvement Tax Credit (25C) stipulates up to a $3,200 annual max for qualifying equipment, but that cap resets each year. With the tax credit available for 10 years, you can guide your customers toward making a new improvement every year.

Additional Services

The Energy Efficient Home Improvement Tax Credit (25C) also provides $150 toward a home energy audit. An energy audit will uncover additional home improvement opportunities eligible for rebates in both the HOMES and HEEHRA programs, which can significantly reduce the cost of a larger whole-home retrofit project.

HVAC contractors could also establish reciprocal business agreements with solar contractors or vice versa. With these tax credits and rebates available for at least the next 10 years, it may be a wise business decision to consider expanding your business offerings to cover more services funded by the IRA, which will undeniably increase customer demand.

Customer Communication

Don’t be surprised if your customer isn’t ready to pull the trigger the first time you discuss the IRA with them. Instead, plan to engage potential customers with regular communication.

At Pearl Certification, we are committed to our Network Contractors’ success, which is why we have developed some templated customer communication to aid your efforts, including:

Sample text to create an IRA webpage on your website
Homeowner IRA FAQs to include online
Shareable Pearl blog posts to help your customers better understand how they can use the IRA to reduce the cost of home energy improvements

Pearl also created individual tax credit reference sheets for HVAC, solar, energy efficiency, and plumbing contractors to help guide your conversations with potential customers.

Tax Season

Pearl Certification even makes it easy for homeowners to collect on their tax credits by providing the documentation they need for their specific improvements in Pearl’s free Green Door app. When Pearl Network Contractors document their work, Pearl automatically notifies homeowners of qualifying upgrades and sends them a link to the corresponding tax document and link to instructions to complete the form. You can help your customers understand the process by sharing the below blog post.

Next Steps

If you are a Pearl Network Contractor, login to the Resource Center today to access your IRA customer communication templates to encourage them to start thinking about how they can make the single largest U.S. investment in energy efficiency work for them. Contact your Relationship Manager if you need help accessing the Resource Center.

If you’re not a member of the Pearl Network, complete the form below to discover how we can help you leverage the Inflation Reduction Act to build your business.

How to Prepare Your Customers and Your Business for IRA Success