Iowa HVAC Rebates and Tax Credits in 2026: What's Actually Still Available

Last updated: September 2026. Every figure below was read from MidAmerican Energy, the IRS or the Iowa Department of Revenue on the verification date above. Utility programs can end early when funds run out.

This is general information, not tax advice. Consult a tax professional about your own return.

Heat Pumps: $300 to $713 Per Unit From MidAmerican

MidAmerican's 2026 Instant Discount on an air-source heat pump is $300 to $563 per unit for a standard model and $563 to $713 per unit for a cold-climate model. The difference is the tier the equipment qualifies for on MidAmerican's qualification list: a cold-climate unit is one rated to hold its heating output at the low outdoor temperatures a Des Moines January delivers, which is the equipment we recommend for this metro anyway. When you get a quote, ask which tier the model falls in, because it changes the discount by a couple of hundred dollars. The federal credit that used to sit on top of this is gone for 2026; our heat pumps in Iowa winters guide covers the performance side and our heat pump installation page covers the work.

Ductless Mini-Splits: $375 or $525 Per Unit

A ductless split heat pump earns a $375 Instant Discount per unit, and a cold-climate ductless unit earns $525. The same qualification logic applies as for central heat pumps. Ductless is the usual answer for additions, finished basements, garages and older homes without ductwork; see ductless mini-split installation.

Central Air Conditioners: $263 to $413 Per Unit

A qualifying central air conditioner earns $263 to $413 per unit, with the amount set by the efficiency tier the model reaches. Large systems are handled differently, at $150 per ton. There is no federal credit on a 2026 air conditioner. Details on sizing and what drives the price are on our air conditioning installation page.

Geothermal: $900 to $1,200 Per Unit, Plus $113 for a Desuperheater

Geothermal took the biggest hit from the federal change. Through 2025 a ground-source system earned a 30% federal credit with no cap; for a system completed in 2026 that credit is gone, and Iowa's own geothermal credit ended two years earlier. What remains is MidAmerican's $900 to $1,200 Instant Discount per geothermal heat pump and $113 for a desuperheater, the add-on that uses waste heat from the system to preheat domestic hot water. The full history, and what a 2025 install can still claim, is in our geothermal tax credits guide; the equipment and loop options are on geothermal installation.

Gas Furnaces: $2.40 Per MBtuh

The furnace discount is priced by capacity rather than as a flat amount: $2.40 per MBtuh, where one MBtuh is 1,000 BTU per hour of input. A common 80,000 BTU furnace is 80 MBtuh, so the discount is $192; a 100,000 BTU furnace works out to $240. The furnace has to meet MidAmerican's efficiency threshold for the year, which in practice means a high-efficiency condensing model. Furnace replacement is where most Des Moines homeowners meet this discount first, usually after a no-heat call in January; see furnace installation.

Smart Thermostats and Heat Pump Water Heaters

Two smaller items round out MidAmerican's residential list. A smart thermostat earns a rebate of up to $100 per unit when an ENERGY STAR model replaces a manual or programmable thermostat; unlike the equipment discounts, this one is a rebate you apply for online after purchase, within 90 days of purchase or by December 31, 2026, whichever comes first. A heat pump water heater earns a $225 Instant Discount. Water heaters are not a service we offer, so we mention it only so you know it exists when you plan a project.

How a MidAmerican Instant Discount Works

• It goes through the contractor. MidAmerican states that Instant Discounts are only available by purchasing your equipment through a participating Instant Discounts provider. Ask whether your contractor is enrolled before you sign, because a non-participating installer cannot pass the discount along.
• It comes off the price. The discount is applied at the point of sale rather than mailed as a check later, so it shows on the quote.
• It does not stack. An Instant Discount cannot be combined with any other MidAmerican rebate or incentive on the same equipment.
• The window is the 2026 calendar year. Equipment must be purchased, installed and operating between January 1 and December 31, 2026.
• Funds are not unlimited. Utility programs of this kind can close early once their budget is spent, which is why this page carries a verification date and why we confirm the discount when we quote, not when we install.
• Financing works alongside it. The discount lowers the equipment price and financing through our approved partners covers the balance.

Not on MidAmerican? Alliant Energy and Cooperatives

MidAmerican serves most of the Des Moines metro, but parts of Central Iowa are served by Alliant Energy or a rural electric cooperative. Alliant does run rebates on central air conditioners, heat pumps, geothermal systems and thermostats, and cooperatives sometimes add their own. We have not verified the 2026 amounts for those programs on this page, so call your utility with the model numbers on your quote before you count on a figure, and tell us which utility bills you so we can check as well.

If You Installed in 2025

Nothing on this page takes away a credit you earned last year. A heat pump, furnace or air conditioner placed in service by December 31, 2025 is claimed on your 2025 federal return with IRS Form 5695 under the home improvement credit. A geothermal system completed by that date is claimed the same way under the residential clean energy credit, and the Form 5695 instructions allow any portion of that credit you could not use in 2025 to carry forward to 2026. Keep the itemized invoice and the manufacturer's certification statement with your records, and talk to your tax professional about how the carryforward applies to your return.

Permits: Required Across the Metro, and We Pull Them

Replacing a furnace, boiler, air conditioner or heat pump requires a mechanical permit in Des Moines and the surrounding cities, and the rules differ between Des Moines, each suburb and unincorporated Polk County. The permit is pulled by the licensed contractor doing the work, and we handle it as part of every installation. A permitted job is also what MidAmerican and the equipment manufacturer expect behind a discount or a warranty claim, so it is not a step to skip to save a fee.

Update Log

• 2026-09-10: Page published. All figures verified at MidAmerican Energy (Iowa residential discounts and rebates), the IRS Form 5695 instructions and the Iowa Department of Revenue geothermal credit page.