Heat Pump Rebates in Bellevue, WA: PSE Rebates Are Live, the Federal 25C Credit Has Expired, and Washington's HEEHRA-Style Rebates Are Not Open Yet

If you own a home in Bellevue or elsewhere on the Eastside, the short answer is this: the live money right now is from Puget Sound Energy — the federal 25C tax credit has expired. PSE currently has published heat-pump rebates for several common upgrade paths. The federal Energy Efficient Home Improvement Credit under Section 25C, which used to offer a 30% tax credit up to $2,000 per year, ended for heat pumps placed in service after December 31, 2025, under the One Big Beautiful Bill Act. Washington’s separate federal IRA home-rebate program is not open statewide yet, so you should not count on a Washington HEEHRA-style rebate for a project you want to do now. PSE, IRS, Washington Commerce

That matters in Bellevue, Kirkland, Redmond, Mercer Island, Issaquah, and Sammamish because more homeowners are switching from baseboard heat, older electric furnaces, or aging gas systems to heat pumps that can both heat and cool. If you are pricing a replacement, it is smart to run the rebate math before you choose between a straight heat pump, a hybrid system, or another furnace-and-AC setup. If you want help comparing system types, our AC installation service, AC repair service, and furnace repair service pages are a good starting point.

What rebates are available in Bellevue right now?

For most homeowners in Bellevue and the surrounding Eastside, there are three buckets to know:

1. PSE utility rebates for qualifying heat-pump projects.
2. The federal Section 25C tax credit, which expired for equipment placed in service after December 31, 2025.
3. Washington’s future IRA home rebates, which are still in pre-launch status.

The reason this gets confusing is that homeowners often hear “IRA rebates” and assume all of them are already live. They are not. PSE rebates are live. The federal 25C tax credit is not — it ended under the One Big Beautiful Bill Act for heat pumps placed in service after 2025. Washington’s consumer-facing federal home rebate program is still being finalized by the state. IRS, Washington Commerce

PSE heat-pump rebate details for Bellevue and the Eastside

PSE’s current residential heating rebate pages are the most important local source if your home is in Bellevue and you have PSE service.

1. Electric resistance to heat pump rebate

PSE says: “Get a $1,500 rebate” when you replace an electric resistance heating system with a qualifying air-source heat pump, ducted or ductless. That is the main published rebate for homes currently using baseboard heat, wall heaters, cable heat, electric hydronic heat, or an electric forced-air furnace. PSE electric resistance to heat pump rebate

Key eligibility points PSE publishes:

• You must use a PSE Recommended Energy Professional (REP) or PSE Trade Ally.
• You must be a current PSE single-family residential electric customer.
• Your current primary heating system must be electric resistance.
• Existing heat pumps and natural-gas-forced-air systems are not eligible under this specific pathway.
• PSE limits the offer to one rebate per single-family residence.
• PSE says the rebate is available through the contractor working on your project.

PSE also publishes a higher $2,400 Efficiency Boost rebate on that same page for income-qualified customers. Eligibility is tied to PSE’s income guidelines and county-based household thresholds. PSE electric resistance to heat pump rebate, PSE Efficiency Boost

2. Hybrid heat pump rebate

If your Bellevue-area home has a natural gas furnace and you are considering a dual-fuel setup instead of going all-electric, PSE’s hybrid pathway may fit. PSE says: “Get a $1,500 rebate” when you install a qualifying hybrid heating system that pairs a heat pump with a new or existing gas furnace. PSE hybrid heat pump rebate

Key published rules include:

• You must be a current PSE single-family natural gas or dual-fuel customer.
• Your primary current heating system must be a natural gas furnace.
• The new equipment must be an AHRI-certified central ducted heat pump paired with an existing or new natural gas forced-air furnace.
• Ductless heat pumps are not eligible under this rebate path.
• You must still use a PSE REP or Trade Ally contractor.

PSE also lists a $2,400 Efficiency Boost rebate on the hybrid page for income-qualified customers. PSE hybrid heat pump rebate, PSE Efficiency Boost

3. Moderate-income gas-to-electric heat pump rebate

For some Eastside households currently heating with natural gas, PSE publishes a larger income-qualified fuel-switching rebate. PSE says: “Get a $4,000 rebate” when you replace your natural gas heating system with a qualifying air-source heat pump. PSE moderate-income heat pump rebate

Important published rules:

• You must be a current PSE single-family residential natural gas customer.
• Your current primary heating system must be fueled by PSE natural gas.
• You must meet income eligibility requirements.
• The new system must be a qualifying AHRI-certified heat pump.
• The previous gas heating equipment must be removed or decommissioned after installation.
• PSE says the rebate application must be submitted within 30 days of install.
• PSE requires installation by a PSE Trade Ally or REP.

This is the PSE program most homeowners mean when they ask whether there is a bigger Bellevue rebate for switching off gas. There is, but it is income-qualified. PSE moderate-income heat pump rebate

4. Heat-pump-to-heat-pump upgrades and contractor pass-through discounts

PSE also lists a heat pump to heat pump upgrade rebate on its heating hub and separately notes that some high-efficiency models may qualify for pass-through discounts from contractors through its midstream program. That matters if you already have a heat pump and are replacing it with a newer system rather than converting from baseboard or gas. PSE heating rebates

Federal 25C tax credit: what changed

The federal credit to know is the Energy Efficient Home Improvement Credit under Internal Revenue Code Section 25C — and it is no longer available for new installations.

Under the One Big Beautiful Bill Act, the 25C credit was terminated for property placed in service after December 31, 2025. If your heat pump is not installed and placed in service by that date, you cannot claim this credit, regardless of when you signed a contract or paid a deposit. IRS 25C overview

If your heat pump was installed on or before December 31, 2025

You may still be able to claim the credit on your 2025 tax return. Here is how it worked while it was active:

• 30% of qualified expenses
• Up to $2,000 per year for qualifying heat pumps, water heaters, or biomass stoves/boilers
• An overall yearly maximum of up to $3,200 when combined with other eligible improvements
• Claimed on IRS Form 5695, Part II, for the tax year the property was placed in service — not merely purchased
• Nonrefundable, so it could not exceed the tax you owed, and unused amounts could not be carried forward
• Public utility subsidies subtracted first: if you also received a PSE rebate, the IRS required you to subtract that subsidy from your qualified expenses before calculating the 30% credit

If this describes your project, talk to your tax preparer about claiming it for tax year 2025, and keep your final invoice, model and AHRI information, any manufacturer certification your installer provided, and your record of the PSE rebate amount. IRS 25C overview, IRS Form 5695 instructions

What this means if you are installing in 2026 or later

Do not build the federal 25C credit into your budget. For heat pumps placed in service after December 31, 2025, the credit simply does not exist anymore. The rebate math for a current Bellevue project now comes down to PSE’s published rebates, plus whatever Washington’s HEEHRA-style program eventually offers once it launches statewide. That makes it worth confirming every PSE pathway you qualify for before you sign a contract. ENERGY STAR air-source heat pump credit page

What about HEEHRA in Washington?

This is the part many Bellevue homeowners are waiting on.

Washington State Commerce’s current IRA Home Energy Rebates page says the state is still in “Step 5 - Program operation preparation” and that Step 6 is DOE launch approval, followed by Step 7: Statewide launch, when “Washingtonians may apply and receive rebate funds for home upgrades.” Washington Commerce IRA Home Energy Rebates

Commerce also says:

• “Rebates are not retroactive.”
• You must apply and be approved first before buying appliances or doing the upgrades.
• The program covers low- and moderate-income households and includes heat pumps, wiring, panel upgrades, insulation, air sealing, ventilation, appliances, and general weatherization measures.

Washington is using the names HARP and HOMES on its current consumer page. HARP is the state’s appliance and electrification rebate track related to the federal high-efficiency electric home rebate framework. The practical takeaway for Bellevue homeowners is simple: if your heat-pump project is happening now, do not assume you can claim a Washington point-of-sale HEEHRA-style rebate unless the state has officially launched before your project starts. Washington Commerce IRA Home Energy Rebates

Washington Commerce’s contractor-network page says it is in the final stage of getting U.S. Department of Energy authorization for program launch, and the contractor list will be public once the program launches. Washington Commerce QCN page

Step-by-step: how Bellevue homeowners should claim the available savings

If you want the PSE rebate now

1. Confirm that your home is a PSE-served single-family residence and identify your current heating type.
2. Ask your contractor which PSE pathway applies: electric-resistance conversion, hybrid heat pump, moderate-income gas-to-electric, or another published heat-pump path.
3. Make sure the contractor is a PSE REP or Trade Ally if the rebate page requires it.
4. Have the contractor confirm the exact AHRI-rated equipment and any lockout or control requirements in writing.
5. Ask whether the rebate will be applied through the contractor or submitted separately after install.
6. If you are using the moderate-income fuel-switching rebate, do not miss PSE’s 30-day post-install submission window.

About the federal 25C credit

The federal 25C credit expired for heat pumps placed in service after December 31, 2025. If you are installing now, do not plan around it — PSE’s rebate is the incentive available to you.

If your heat pump was placed in service on or before December 31, 2025, you may still be able to claim it for the 2025 tax year:

1. Save the final paid invoice and equipment details.
2. Subtract any qualifying PSE utility subsidy from your eligible cost before figuring the credit.
3. Use Form 5695, Part II for the 2025 tax year.
4. Keep your paperwork in case your tax preparer or the IRS asks how you calculated the credit.

If you are waiting for Washington’s HEEHRA-style rebate

1. Watch the Washington Commerce IRA Home Energy Rebates page for launch updates.
2. Do not assume retroactive reimbursement.
3. Expect the state to require approval before purchase or installation once the program opens.
4. If your existing system is failing now, compare the value of today’s PSE rebate — the federal 25C credit no longer applies to new installs — against the risk of waiting. Washington Commerce IRA Home Energy Rebates

Bellevue and Eastside considerations that matter

In the Bellevue area, the rebate conversation is not just about winter heat. A lot of older homes on the Eastside were built with electric resistance heat and no central cooling, while newer homes may have aging gas furnaces and separate AC systems. That is why heat pumps are showing up more often in replacement quotes here: they solve both heating and cooling in one project.

For homeowners in Bellevue, Kirkland, Redmond, Mercer Island, Issaquah, and Sammamish, the smartest rebate play usually depends on the system you have today:

• Baseboard or electric furnace now: the PSE electric-resistance conversion rebate is often the first place to look.
• Gas furnace and you want dual fuel: compare PSE’s hybrid heat pump rebate.
• Gas furnace and you want full electrification: check the moderate-income PSE fuel-switching path first.

If you want a second opinion on whether a heat pump makes sense for your house, call (425) 598-0416 or use our contact page.

FAQ

What heat pump rebates are available right now for Bellevue homeowners?

For many Bellevue-area homeowners served by Puget Sound Energy, the live incentive is PSE heat-pump rebates. PSE currently lists a $1,500 rebate for electric-resistance-to-heat-pump conversions, a $1,500 rebate for qualifying hybrid heat pump systems, and a $4,000 moderate-income rebate for qualifying natural-gas-to-heat-pump projects. The federal 25C tax credit, which used to add 30% of eligible costs up to $2,000 per year, expired for heat pumps placed in service after December 31, 2025. PSE heating rebates, IRS 25C overview

Can I combine a PSE heat pump rebate with the federal 25C tax credit?

Only for heat pumps placed in service on or before December 31, 2025. For those installations, the IRS required public utility subsidies for buying or installing clean energy property to be subtracted from qualified expenses before calculating the credit, so a PSE rebate typically lowered the amount used for the federal credit calculation. The 25C credit itself has since expired and does not apply to new projects. IRS 25C overview

Is the federal HEEHRA rebate available in Washington yet?

Not statewide as of the current Washington Commerce program page. Commerce says it is still in program operation preparation and awaiting DOE launch approval before Washingtonians may apply and receive rebate funds. Washington Commerce IRA Home Energy Rebates

Is the federal 25C heat pump tax credit still available for new installations?

No. The federal 25C credit expired for heat pumps placed in service after December 31, 2025, under the One Big Beautiful Bill Act. If your heat pump was placed in service on or before that date, you can still claim it on IRS Form 5695, Part II for the 2025 tax year — keep your invoices and equipment documentation. IRS 25C overview

Do I need to apply before installation for Washington’s future IRA rebate program?

Yes. Washington Commerce says the rebates are not retroactive and that homeowners must apply and be approved before buying appliances or doing the upgrades once the program launches. Washington Commerce IRA Home Energy Rebates

Sources

• Puget Sound Energy: Heating rebates
• Puget Sound Energy: Electric resistance to air-source heat pump conversion rebate
• Puget Sound Energy: Hybrid heat pump
• Puget Sound Energy: Moderate-Income Fuel-Switching Heat Pump Program
• Puget Sound Energy: Efficiency Boost
• IRS: Energy Efficient Home Improvement Credit
• IRS: Instructions for Form 5695
• ENERGY STAR: Air Source Heat Pumps Tax Credit
• Washington State Department of Commerce: IRA Home Energy Rebates
• Washington State Department of Commerce: Home Energy Rebates Qualified Contractor Network