If you are filing your 2022 taxes, click here to see information about the credit extensions through December 31, 2022.
For Homeowners:
New for 2023! The Inflation Reduction Act of 2022 provided new Energy Efficient Home Improvement Credits which are available on certain products installed from January 1, 2023, through December 31, 2032.
You can now claim tax credits for improvements such as:
- heat pumps,
- heat pump water heaters,
- Biomass Stoves/Boilers
- insulation,
- doors
- windows,
- electrical panel upgrades,
- home energy audits
- Central Air Conditioners
- Furnaces (Natural Gas, Oil)
- Hot Water Boilers (Natural Gas, Oil, Propane)
- Water Heaters (Natural Gas)
There is a $1,200 aggregate yearly tax credit maximum for all building envelope components, home energy audits, and energy property.
Electric or natural gas heat pump water heaters, electric or natural gas heat pumps, and biomass stoves and biomass boilers have a separate aggregate yearly credit limit of $2,000.
The maximum total yearly energy efficient home improvement credit amount may be up to $3,200.
The tax credits for residential renewable energy products – now called Residential Clean Energy Tax Credits are available and feature a gradual step down in the credit value through December 31, 2034.
These tax credits are for certain:
- Geothermal heat pumps
- Fuel cells,
- Small wind turbines,
- Solar energy systems (water heaters and panels),
- Battery storage technology
The following amounts apply for the prescribed periods for the Residential Clean Energy Tax Credit:
- 30% for property placed in service after December 31, 2016, and before January 1, 2020
- 26% for property placed in service after December 31, 2019, and before January 1, 2022
- 30% for property placed in service after December 31, 2021, and before January 1, 2033
- 26% for property placed in service after December 31, 2032, and before January 1, 2034
- 22% for property placed in service after December 31, 2033, and before January 1, 2035
Details: Existing homes and new construction qualify. Both principal residences and second homes qualify. Rentals do not qualify.
For Home Builders
The tax credit for builders of energy efficient homes has also been updated and extended through December 31, 2032.
For Commercial Building Owners
Section 179D of the Internal Revenue Code allows deductions for energy-efficient commercial buildings . These tax deductions were made permanent under the Consolidated Appropriations Act of 2021.
For more information, see the IRS’ web page: Federal Income Tax Credits and Incentives for Energy Efficiency
In addition to federal tax credits, local rebates and offers may be available in your area. Check the ENERGY STAR Rebate Finder, where you can enter your zip code to find rebates and other offers in your area. You may also want to contact your local utility or state energy office about any available incentives or programs.