How to Boost Your HVAC Marketing Strategy with EEHITC and Tax Incentives

Tax incentives and rebates act as financial incentives, and although they’re often overlooked, they are powerful tools for tapping into consumer buying triggers. By integrating them into your HVAC marketing strategy and messaging — specifically into your HVAC marketing “value stack” — you can maximize your marketing efforts and increase your replacement equipment sales.

The Energy Efficient Home Improvement Tax Credit (EEHITC), which was introduced in the 2022 Inflation reduction act, is a fantastic example of a recent tax incentive offering strong value to consumers. However, many HVAC and home services businesses haven’t yet integrated it into their marketing messaging or their sales strategies. This represents a major lost opportunity for contractors who have been slow to adapt.

To this end, HVAC contractors and business owners should thoroughly understand the tax incentives and rebates available to their customers, as these programs can majorly impact consumer decision-making. Read on to learn more about how you can use tax incentives and rebates to boost your replacement sales, increase customer satisfaction, and build brand loyalty.

Why Tax Incentives and Rebates Matter

Price is a major barrier to large HVAC purchases. Though the median household income in the United States was $70,784 in 2021, over a quarter of U.S. households made less than $35,000 a year. Considering that the average cost to install an AC unit is $5,806 and the average cost for furnace installation is $4,709, it’s clear that upgrading an HVAC system will present a significant financial challenge to many homeowners.

Sinking over 14% of total annual income into any one home improvement requires some serious consideration, which is why it’s important for HVAC companies to have the right marketing tools in hand when they’re making these sales. Tax incentives and rebates promise money back on qualifying products, and can therefore tip the scale in the decision-making process. A customer who’s wavering between a low-priced furnace that’s less efficient and one with a higher AFUE and higher price tag may opt for the higher-quality unit when they realize that they can recoup some of the cost through these types of programs.

Though the government offers a plethora of opportunities for tax incentives and rebates, consumers aren’t always up-to-date on this information. Purchasing a new air conditioner is something the average homeowner will only have to tackle once every 15 to 20 years. Meanwhile, HVAC companies navigate these sales frequently. Providing customers with detailed information on how they can utilize these programs to save money is a great way to boost your brand reputation and increase customer loyalty.

How to Incorporate Tax Incentives and Rebates in Your Marketing Messaging

The first step to properly marketing tax incentives and rebates is thoroughly researching all the options that are available to your customers. The Energy Efficient Home Improvement Tax Credit (EEHITC) is one of the best-known options and it offers significant value to homeowners who purchase qualifying equipment under this credit. According to the IRS, “If you made qualifying energy-saving improvements to your home after January 1, 2023, you may be eligible for a tax credit of up to $3,200.” This credit covers:

• 30% of home energy audit expenses up to $150.
• 30% of property costs for AC, water heater, furnace, and boiler products including labor, provided that they meet energy efficiency requirements, up to $600.
• 30% of heat pump product costs including labor, provided that they meet energy efficiency requirements.

There is a yearly aggregate tax credit maximum of $1,200 under this program. Electric or natural gas heat pumps and heat pump water heaters have a separate aggregate annual credit limit of $2,000.

By readily supplying this information to consumers, you can assist them in maximizing the benefits of available tax credits. Furthermore, your technicians can leverage these tax credits to encourage customers to schedule their upgrades strategically. For instance, a homeowner may choose to replace their air conditioner in one tax year and postpone the furnace upgrade until the following year to ensure they do not exceed the $1,200 maximum limit.

The EEHITC is just one of many tax credits and rebates that your customers may qualify for. The Inflation Reduction Act (IRA) was signed into law in August 2022. This law authorizes State Energy Offices and Indian Tribes to provide home energy rebates for qualifying home efficiency projects. The specifics of the program will vary by location. HVAC companies can streamline their marketing messaging by compiling this information as it relates to the local market and delivering the most relevant details in a simple, streamlined manner.

For example, the IRA determines rebate amounts by considering household income and projected energy savings. By proactively collecting pertinent information, you can assist your customers in determining their eligibility and present your sales pitch armed with accurate figures. This approach enables you to deliver a targeted and compelling message that resonates with your customers, showcasing the potential savings they can achieve.

Delve even deeper into the specific products that can assist your customers in achieving their desired goals. By providing clear details, such as informing homeowners that they can receive a maximum rebate of $4,000 with a product that offers 20% predicted energy savings or up to $8,000 with a product boasting a minimum of 35% predicted energy savings, you create a compelling selling point for higher-priced purchases. This precise information showcases the potential benefits and cost savings associated with investing in more efficient options, allowing you to effectively communicate the value proposition to your customers.

Common Misconceptions and Concerns About Tax Incentives and Rebates

It is crucial to have a comprehensive understanding of the intricacies surrounding tax incentives and rebates. As mentioned earlier, it is important to note that the specific rebate amount provided by the IRA can vary depending on the homeowner’s location, household income, and projected energy savings. By staying well-informed about these factors, you can confidently market your products without the risk of disseminating inaccurate information.

EEHITC tax incentives exclusively apply to products that meet or surpass the highest efficiency tier set by the Consortium for Energy Efficiency (CEE). It’s important to note that new efficiency tiers are implemented at the start of each year. As a result, a quote provided in November may no longer be eligible for this incentive once January arrives. Maintaining accuracy and transparency is of utmost importance when marketing programs of this nature. Ensuring that customers are informed about the specific requirements and any potential updates will help build trust and credibility in your marketing efforts.

Tax incentives and rebates serve as compelling selling points for energy-efficient HVAC upgrades that every heating and cooling company should prioritize. By incorporating these incentives into your marketing messaging, you can showcase your commitment to safeguarding both the environment and your customers’ financial prosperity. Take the time to research the available programs in your area and gather all the essential information to help your clients make the most informed choices. Integrate this messaging into your marketing materials, and you will provide shoppers with a compelling reason to choose your services.

Integrate EEHITC and Tax Incentives into Your HVAC Marketing Value Stack

Mediagistic offers well-rounded marketing strategies for integrating all kinds of incentive-based language into your HVAC marketing value stack. We’ll help you refine your marketing messaging and build maximum value with your target consumer to make the most of your home services marketing campaigns. Get in touch with our expert marketing team today to learn more about how we can help.