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SEER to SEER2: Real-World Efficiency Standards Are Still in Place
As of January 1, 2023, the Department of Energy moved from the older SEER rating system to SEER2, a stricter efficiency rating designed to better reflect real-world HVAC operating conditions.
- Northern states, including Illinois, require split-system central air conditioners to meet at least 13.4 SEER2.
- Split-system heat pumps manufactured on or after January 1, 2023, must meet at least 14.3 SEER2 and 7.5 HSPF2.
- Southeast and Southwest regions have higher cooling-efficiency requirements for certain air conditioning systems, but those regional standards do not apply to Illinois installations.
The takeaway? If you are replacing an air conditioner or heat pump in Central Illinois, your new equipment still needs to meet current SEER2 standards. A qualified HVAC contractor can help confirm that the system being installed is compliant for this region.
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Federal Tax Credits: What Changed for 2026
Under the Inflation Reduction Act of 2022, many homeowners expected federal energy-efficiency tax credits to remain available into the 2030s. However, the One Big Beautiful Bill Act, signed in July 2025, accelerated the expiration of several home energy credits.
What Changed
Tax Credit Type What It Covered Status for 2026 Section 25C – Energy Efficient Home Improvement Credit Qualifying heat pumps, central air conditioners, furnaces, boilers, water heaters, insulation, windows, doors, panels, and home energy audits Not available for qualifying property placed in service after Dec. 31, 2025 Section 25D – Residential Clean Energy Credit Qualifying residential clean energy property, including solar, geothermal, battery storage, and similar improvements Not available for expenditures made after Dec. 31, 2025 For homeowners planning HVAC work in 2026, this means the federal 25C tax credit is no longer available for new qualifying HVAC equipment placed in service this year. If you had qualifying equipment installed in 2025, you may still need the proper documentation when filing your 2025 tax return.
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Important Paperwork for 2025 Installations
If your qualifying HVAC system was installed and placed in service in 2025, keep your paperwork together before filing. This may include:
- Installation receipts and invoices
- Manufacturer certification documents
- Model numbers and efficiency ratings
- The required manufacturer identification information, such as the QMID, when applicable
- IRS Form 5695 for claiming residential energy credits
Beginning in 2025, the IRS required a valid manufacturer identification number for certain qualifying energy property claimed under the Energy Efficient Home Improvement Credit.
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Why These Changes Still Matter for Homeowners
- SEER2 compliance still matters. Even without the federal tax credit, replacement equipment must meet current federal efficiency standards.
- Lower utility costs still matter. A properly sized, efficient system can help reduce wasted energy and improve comfort.
- Documentation still matters. If your system was installed in 2025, keep the paperwork needed for tax filing and warranty purposes.
- Local guidance matters. HVAC requirements, equipment sizing, ductwork condition, and comfort needs can vary from home to home or business to business.
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Smart Next Steps for Central Illinois Homeowners and Businesses
- Confirm SEER2 compliance: Make sure your replacement equipment meets current standards for Illinois.
- Review your current system: If your AC, furnace, or heat pump is older, inefficient, or unreliable, have it evaluated before peak heating or cooling season.
- Ask about system sizing: Bigger is not always better. Proper sizing helps comfort, efficiency, humidity control, and equipment life.
- Keep your records: Save invoices, model numbers, warranty information, and any tax-related documentation from prior qualifying work.
- Talk with your HVAC provider: A qualified contractor can help you compare repair, replacement, and efficiency options for your home or business.
Final Word
Federal HVAC tax credits that many homeowners expected to last longer have now expired for new 2026 installations. However, SEER2 efficiency standards are still in effect, and choosing the right system still matters for comfort, energy use, and long-term performance.
If you are planning an HVAC replacement in Taylorville, Springfield, IL, or the surrounding Central Illinois area, Yard Heating & Cooling can help you choose equipment that fits your property, comfort needs, and current efficiency requirements.