Replacing a whole HVAC system (furnace plus central air, or a heat pump with an air handler) typically costs about $5,000 to $12,500 in 2026 for standard-efficiency equipment on existing ductwork. Larger homes, high-efficiency equipment or new ducts can push the total past $20,000. Replacing just one piece costs less: about $4,000 to $8,000 for a central air conditioner, $3,800 to $10,000 for a gas furnace, and $4,500 to $8,000 for an air-source heat pump.
The federal tax credit that cut many of these bills by up to $2,000 is gone for 2026 installs. The Energy Efficient Home Improvement Credit (Section 25C) ended for equipment placed in service after December 31, 2025. State rebates and utility programs are now the main way to lower the price, and they vary a lot by ZIP code. This guide covers equipment costs, efficiency ratings, how proper sizing works, the refrigerant change, available incentives, and how to compare quotes line by line.
HVAC replacement cost by system type
These installed ranges come from This Old House’s 2026 pricing, which draws on Angi data, along with Zonda’s 2025 Cost vs. Value report for the heat pump conversion.
| System | Typical installed cost (2026) | Common lifespan | Best fit |
|---|---|---|---|
| Central air conditioner only | $4,000 to $8,000 | About 12 to 15 years | Homes with a working furnace and ducts |
| Gas furnace only | $3,800 to $10,000 | About 15 to 20 years | Cold climates with natural gas service |
| Air-source heat pump | $4,500 to $8,000 | About 12 to 15 years | Mild to cold climates; replaces AC and some or all heating |
| Ductless mini-split | $1,300 to $8,000 depending on zones | About 12 to 15 years | Additions, homes without ducts, single rooms |
| Full system: furnace plus AC | $5,000 to $12,500; $22,000 or more for large or premium jobs | Varies by component | Most ducted homes replacing both at once |
| Furnace and AC converted to heat pump (Cost vs. Value 2025) | $19,484 national average, 72.1% recouped at resale | About 12 to 15 years | Homeowners moving to electric heating |
Ductwork is separate. Replacing or adding ducts often runs about $1,000 to $2,700 for a 1,000-square-foot system, more in tight attics or crawlspaces. If your ducts are leaky, crushed or undersized, a new high-efficiency unit won’t perform as rated, so ask every contractor to inspect them.
SEER2 and HSPF2 ratings in plain terms
Since 2023, cooling and heat pump equipment is rated under the SEER2, EER2 and HSPF2 test procedures, which use higher fan pressure to better reflect real duct systems. That’s why a SEER2 number looks lower than the old SEER number for the same unit.
- SEER2 measures seasonal cooling efficiency. Higher is better.
- EER2 measures cooling efficiency at a hot peak condition (95°F outside). It matters most in the desert Southwest.
- HSPF2 measures a heat pump’s seasonal heating efficiency.
Federal minimums depend on region. Split-system air conditioners must reach 13.4 SEER2 in the North. In the Southeast and Southwest the minimum is 14.3 SEER2 for systems under 45,000 Btu/h (roughly under 3.75 tons) and 13.8 SEER2 for larger ones, and the Southwest adds EER2 minimums. Split heat pumps must meet 14.3 SEER2 and 7.5 HSPF2 nationwide.
Going above the minimum makes the most sense where you run the equipment hardest. A 16 or 17 SEER2 AC in Phoenix or Houston pays back faster than the same unit in Minneapolis, where a high-efficiency furnace or a cold-climate heat pump is usually the better place for extra money.
Sizing: why a Manual J calculation matters
Old rules of thumb, such as one ton of cooling per 500 square feet, ignore insulation, window area, air leakage, ceiling height and which way the house faces. An oversized unit cools the air quickly and shuts off before it removes humidity, so the house feels clammy, the system short-cycles, and parts wear faster. An undersized unit runs constantly on the hottest and coldest days.
The industry standard is a load calculation using ACCA Manual J, followed by Manual S to choose equipment that matches the load and Manual D to check the ducts. A good contractor measures rooms and windows, asks about insulation and recent upgrades, and gives you a printed report. If a bidder simply matches the size of your old unit, ask why. Many older systems were oversized to begin with, and if you’ve added insulation or new windows since, your load has dropped.
Example: The Nguyens’ 2,000-square-foot house has a 4-ton AC from 2009. Since then they’ve added attic insulation and replaced windows. Two contractors quote another 4-ton system. A third runs a Manual J that shows a peak cooling load of about 30,000 Btu/h, which is 2.5 tons, and recommends a 3-ton variable-speed heat pump. The smaller unit costs less, runs longer at low speed, and controls humidity better.
The 2026 tax credit and rebate picture
Under the 2025 budget law, the 30% Energy Efficient Home Improvement Credit (25C), which allowed up to $2,000 a year for qualifying heat pumps and up to $600 for central AC and furnaces, ended for expenditures and property placed in service after December 31, 2025. The geothermal heat pump credit under Section 25D also ended for expenditures after that date. The IRS instructions for Form 5695 confirm both cutoffs. Equipment installed in 2026 does not qualify, regardless of when you bought it.
What’s still available:
- State Home Electrification and Appliance Rebates (HEAR). Funded by the 2022 Inflation Reduction Act and run by states, these offer up to $8,000 toward a heat pump for households under 80% of area median income, and up to half the cost for households between 80% and 150%. Only some states have launched programs, some have paused, and at least one large program ran through its first round of funding early in 2026. Check your state energy office.
- Utility rebates. Many electric and gas utilities offer a few hundred to a few thousand dollars for heat pumps or high-efficiency furnaces, sometimes with a required contractor list.
- Manufacturer promotions and financing, usually seasonal.
Rebates often require approval before installation. Ask the contractor to confirm in writing which programs the job qualifies for and who files the paperwork.
The refrigerant change and what it means for your quote
New residential AC and heat pump systems manufactured since January 1, 2025 use lower-global-warming refrigerants, mainly R-454B or R-32, in place of R-410A. In May 2026 the EPA finalized a rule, effective July 27, 2026, that lets contractors keep installing R-410A split systems manufactured or imported before 2025 until existing stock runs out. New York kept the original January 1, 2026 cutoff, so those units can’t be installed there.
A leftover R-410A system may be discounted. The trade-off is service cost later: R-410A production is being phased down, so recharging a leaking system will likely get more expensive over its life. If a quote lists an R-410A unit, ask the manufacture date and compare it with an equivalent R-454B or R-32 option.
How to compare HVAC quotes
Get at least three quotes, and make them comparable before you look at price.
- Ask each contractor for a written Manual J load calculation, not a size based on the old unit.
- Get exact model numbers for the outdoor unit, indoor coil or air handler, and furnace. Look them up in the AHRI directory to confirm the matched SEER2 and HSPF2 ratings.
- Check the refrigerant type and, for R-410A units, the manufacture date.
- Confirm what’s included: removal and disposal, new line set or flushing the old one, new pad, thermostat, condensate drain, electrical disconnect, duct modifications, permit and startup testing.
- Compare warranties: parts (often 10 years with registration) and labor (varies widely, from one year to ten).
- Ask which rebates the system qualifies for and whether the contractor submits them.
- Verify license, insurance and that the permit will be pulled. A permit means an inspector checks the installation.
Example: Rita gets three quotes for a 3-ton heat pump: $9,800, $11,200 and $13,500. The cheapest reuses a 15-year-old line set, includes no permit and offers one year of labor. The $11,200 quote includes a new line set, a permit, a Manual J report and 10 years of parts and labor. The $13,500 quote adds a variable-speed unit with a higher SEER2 rating. With a $1,000 utility rebate on the variable-speed model, the gap between the top two quotes drops to $1,300, and she picks based on comfort and expected cooling bills.
Repair or replace?
Replacement usually makes sense when a system is past about 15 years and needs a major repair such as a compressor or heat exchanger, when repair bills over the last two years approach a third of the replacement cost, or when comfort problems persist despite repairs. A common shortcut is to multiply the unit’s age by the repair cost: if the result is above about $5,000, replacement is often the better buy. A newer system with a single failed part is usually worth fixing.
Common questions
How much does it cost to replace an HVAC system in 2026?
A typical furnace and AC replacement on existing ducts costs about $5,000 to $12,500. Large homes, premium efficiency or new ductwork can push it past $20,000. Single components cost less: about $4,000 to $8,000 for central AC or $3,800 to $10,000 for a gas furnace.
Can I still get a federal tax credit for a heat pump in 2026?
No. The Section 25C credit ended for property placed in service after December 31, 2025, according to IRS Form 5695 instructions. State HEAR rebates and utility programs may still help, depending on where you live and your income.
What SEER2 rating should I buy?
Meet your regional minimum at a minimum: 13.4 SEER2 for AC in the North and 14.3 in most of the South, with heat pumps at 14.3 SEER2 nationwide. In hot climates, 16 SEER2 or higher often pays back over the system’s life.
Should I replace my AC and furnace at the same time?
If both are more than about 12 to 15 years old, replacing them together usually saves labor and ensures the indoor coil and outdoor unit are a matched, rated pair. If the furnace is newer and healthy, replacing only the AC with a matched coil is reasonable.
How long does HVAC installation take?
A straight replacement of a furnace and AC usually takes one to two days. Jobs with new ductwork, electrical upgrades or a switch to a heat pump can take three to five days.
Before you sign
- Insist on a Manual J report and model numbers you can check in the AHRI directory.
- Know your regional SEER2 minimum and decide how far above it to go.
- Ask about refrigerant type and manufacture date.
- Check your state energy office and utility for rebates before the install date.
- Get the permit, warranty terms and included items in writing.
Editorial note: This article is general information, not tax or financial advice. Costs, efficiency rules and incentive status were checked as of November 2026; confirm tax rules with the IRS or a tax professional and rebate eligibility with your state energy office and utility.