TAX CREDITS FOR HOMEOWNERS
Under the Inflation Reduction Act of 2022, federal income tax credits for energy efficiency home improvements will be available through 2032. A broad selection of ENERGY STAR certified equipment is eligible for the tax credits. Independently certified to save energy, ENERGY STAR products are a smart investment for energy efficiency you can count on.
Annual Limits on Energy Efficient Home Improvement Tax Credits
In addition to limits on the amount of credit you can claim for any particular equipment installation or home improvement, there are annual aggregate limits. The overall total limit for an efficiency tax credit in one year is $3,200. This breaks down to a total limit of $1,200 for any combination of home envelope improvements (windows/doors/skylights, insulation, electrical) plus furnaces, boilers and central air conditioners. Any combination of heat pumps, heat pump water heaters and biomass stoves/boilers are subject to an annual total limit of $2,000.
The Inflation Reduction Act of 2022 extended the federal income tax credit for solar energy systems.
The following Residential Clean Energy Tax Credit amounts apply for the prescribed periods:
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30% for property placed in service after December 31, 2016, and before January 1, 2020
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26% for property placed in service after December 31, 2019, and before January 1, 2022
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30% for property placed in service after December 31, 2021, and before January 1, 2033
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26% for property placed in service after December 31, 2032, and before January 1, 2034
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22% for property placed in service after December 31, 2033, and before January 1, 2035
Heating and Cooling Equipment
Furnaces (Natural Gas, Oil, Propane)
Water Heater Tax Credits
Building Products
Residential Clean Energy
Other Tax Credits
TAX CREDITS FOR HOME BUILDERS
Federal Tax Credits for Builders of Energy Efficient Homes
As part of the recently passed Inflation Reduction Act, the Section 45L Tax Credit for Energy Efficient New Homes has been updated and extended. For homes and units acquired on or after January 1, 2023, the base level tax credit will be specifically tied to ENERGY STAR certification for single-family, manufactured, and multifamily homes. This tax credit has been extended through 2032.