DR 1322: Heat Pump Tax Credit Schedule (2025)
Colorado · Colorado DOR · Used for tax years 2025
Colorado Form DR 1322 is the 2025 Heat Pump Tax Credit for Registered Contractors Worksheet. It records qualifying heat pump units placed into service by technology type and calculates the total credit to transfer to the appropriate tax return form.
Who files this form
DR 1322 is a worksheet for heat pump tax credit contractors registered with the Colorado Energy Office. Complete it for the tax year in which the qualifying heat pump technology was placed into service.
To earn the credit, the registered contractor must install qualifying heat pump technology in Colorado and provide 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 heat pump technology in a building they own.
What you'll need
The worksheet and its instructions call for:
- The taxpayer's name and SSN, ITIN, or FEIN.
- The receipt or invoice showing the required installation discount as a separate item.
- Information about the heat pump type and units placed into service during 2025.
- Property information needed to count units, such as the number of residences served or the heating capacity in tons for a nonresidential building.
How to file
The document is marked DO NOT SEND. Use the worksheet to calculate the credit and transfer the total to the appropriate tax return form.
- Enter your taxpayer name and SSN, ITIN, or FEIN.
- Enter eligible units placed into service during 2025 on lines 1, 3, and 5, grouped by heat pump type.
- 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 and enter the total on line 7.
- Transfer line 7 to the appropriate form for your return:
- DR 0104CR, line 14
- DR 0106CR, line 31A
- DR 0112, line 38
- DR 0105, line 34
- DR 0990, line 5
The supplied text does not provide mailing or e-filing directions.
Common mistakes
- Claiming the credit without contractor registration. The credit is allowed only to heat pump tax credit contractors registered with the Colorado Energy Office.
- Leaving the discount off the invoice or receipt. The required discount must appear as a separate item.
- Claiming the credit solely because you own the building. A building owner can claim it only if they are a registered contractor who installed their own qualifying heat pump technology in that building.
- Using the wrong tax year. Complete the worksheet for the year the heat pump technology was placed into service.
- Sending the worksheet. The document is marked “DO NOT SEND.” Transfer the total credit to the appropriate return form instead.
Questions people ask
What are the credit amounts for 2025?
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 units for residential properties?
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 heating capacity in tons 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 can a building owner benefit without claiming the credit directly?
In general, the owner must hire a registered heat pump tax credit contractor who participates in the program and offers the required discount.
Do building owners still need to certify eligibility and assign the credit?
No. The instructions say building owners are no longer required to certify their eligibility and assign the income tax credit for each heat pump.