DR 1322: Heat Pump Tax Credit Schedule (2024)
Colorado · Colorado DOR · Used for tax years 2024
Colorado Form DR 1322 is the 2024 Heat Pump Tax Credit for Registered Contractors Worksheet. It records qualifying heat pump units placed into service and calculates the total credit to transfer to the appropriate tax return form.
Who files this form
Complete this worksheet if you are a heat pump tax credit contractor registered with the Colorado Energy Office. Use it for the tax year when the qualifying heat pump technology was placed into service.
To earn the credit, you must install qualifying heat pump technology in Colorado and give a discount shown as a separate item on the receipt or invoice.
Building owners cannot claim the credit unless they are registered heat pump tax credit contractors who installed their own qualifying technology in a building they own. Other building owners generally benefit by hiring a participating registered contractor who offers the required discount.
What you'll need
The worksheet calls for:
- Your taxpayer name and SSN, ITIN, or FEIN.
- The types and numbers of qualifying heat pump units placed into service during 2024.
- Property information needed to count units, including heating capacity for nonresidential buildings.
The installation receipt or invoice must show the required discount as a separate item. The supplied text does not list documents to attach.
How to file
- Enter your taxpayer name and SSN, ITIN, or FEIN.
- Enter the unit counts on line 1 for heat pump water heaters, line 3 for air-source or variable refrigerant flow heat pumps, and line 5 for ground-source, water-source, or combined-source heat pumps.
- Calculate the credits: multiply line 1 by $500, line 3 by $1,500, and line 5 by $3,000. Enter the results on lines 2, 4, and 6.
- Add lines 2, 4, and 6 on line 7.
- Transfer line 7 to the appropriate return form: DR 0104CR line 14, DR 0106CR line 35A, DR 0112 line 37, DR 0105 line 32, or DR 0990 line 5.
The instruction pages are marked “DO NOT SEND.” The supplied text does not provide a mailing address or e-file directions.
Common mistakes
- Using the previous credit rules. The previous 10% income tax credit and sales tax exemption expired on December 31, 2023. The new credit beginning January 1, 2024, is available only to registered heat pump tax credit contractors.
- Claiming the credit just because you own the building. Building owners cannot claim it unless they meet the registered-contractor and self-installation requirements.
- Leaving the discount off the receipt or invoice. The required installation discount must appear as a separate item.
Questions people ask
What are the credit amounts for 2024?
The worksheet allows $500 per heat pump water heater unit, $1,500 per air-source or variable refrigerant flow heat pump unit, and $3,000 per ground-source, water-source, or combined-source heat pump unit.
How do I count residential units?
For a single-family residence, count one unit for each residence where you installed a heat pump. For a multifamily property, count the residential units that will use the heat pump technology.
How do I count units for a nonresidential building?
Divide the total tons of heating capacity by four and round down to a whole number. For example, 15 tons divided by four equals 3.75, which rounds down to three units.
How do I count units for a thermal energy network or campus?
Count each single-family residence, multifamily property unit, and nonresidential building increment networked into the single heat pump system.
Do building owners still need to certify eligibility and assign the credit?
No. Building owners are no longer required to certify their eligibility and assign the income tax credit for each heat pump.