The Inflation Reduction Act (IRA) of 2022 significantly expanded federal tax credits for residential energy efficiency improvements. Homeowners upgrading heat pumps, windows, insulation, water heaters, and other qualifying systems could claim 30% of the cost through the Energy Efficient Home Improvement Credit (Section 25C). The credit expired December 31, 2025, but homeowners who completed qualifying installations in 2025 can still claim it on their 2025 tax return filed in 2026. The QMID is the key identifier required on Form 5695.
What the 25C credit covered. Section 25C applied to upgrades to existing primary residences. Qualifying categories included heat pumps (air-source and geothermal), heat pump water heaters, central air conditioners, high-efficiency furnaces and boilers, windows and skylights, exterior doors, insulation and air sealing materials, biomass stoves, and energy audits. New construction did not qualify, nor did vacation homes or rental properties.
Credit limits by category. The annual credit limits were $600 for windows, $500 for exterior doors ($250 per door), $600 for HVAC equipment other than heat pumps, and $2,000 for heat pumps and biomass stoves. The total annual 25C credit was capped at $3,200 combined.
How QMIDs work. The IRS required manufacturers to register and obtain a 4-character QMID. When you purchased a qualifying product, you recorded the QMID on IRS Form 5695. The QMID links your purchase to the manufacturer's IRS registration. Many brands share a QMID because the code identifies the parent manufacturer — for example, Bryant, Payne, Heil, and Comfortmaker all use Carrier's code N8H2.
Getting your QMID. Your HVAC installer or retailer should have provided the QMID at installation. If they didn't, look up the manufacturer here, check the manufacturer's website, or contact them directly. Keep all receipts, QMID codes, and product documentation with your tax records — the IRS may request this information for up to 3 years.
Filing for the credit. Claim the 25C credit on IRS Form 5695 (Residential Energy Credits) when you file your 2025 federal tax return. The credit is non-refundable — it reduces your tax liability but cannot generate a refund if your credit exceeds your taxes owed. Unused credit does not carry forward.