The IRS is reminding taxpayers of certain energy efficient updates to their homes could qualify them for home energy tax credits.

Taxpayers can claim the Energy Efficient Home Improvement Credit and the Residential Clean Energy Credit by making qualifying energy-efficient improvements to their primary residence.
Renters may also be able to claim the credits as well as owners of second homes used as residences. Credits are not available to Landlords.

Energy Efficient Home Improvement Credit
Energy-efficient improvements may provide a tax credit up to $3,200 if made after Jan. 1, 2023. 

  • Qualified energy-efficient improvements installed during the year can include improvements like:
    • Exterior doors, windows and skylights
    • Insulation and air sealing materials or systems
  • Residential energy property expenses such as:
    • Central air conditioners
    • Natural gas, propane or oil water heaters
    • Natural gas, propane or oil furnaces and hot water boilers
  • Heat pumps, water heaters, biomass stoves and boilers
  • Home energy audits of a main home

The maximum credit that can be claimed each year is:

  • $1,200 for energy property costs and certain energy efficient home improvements with limits on doors, windows and home energy audits
  • $2,000 per year for qualified heat pumps, biomass stoves or biomass boilers

The credit is nonrefundable which means taxpayers cannot get back more from the credit that what is owed in taxes and cannot be carried to future years.

Residential Clean Energy Credit

Taxpayers who invest in energy improvements for their primary residence such as solar, wind, geothermal, fuel cells or battery storage may qualify for an annual resident clean energy tax credit.

The Residential Clean Energy Credit equals 30% of the cost of new, qualified clean energy property for a home in the United States installed anytime from 2022 thru 2033.  The clean energy equipment must meet certain standards to qualify for the Residential Clean Energy Credit.

  • Qualified expenses include the costs of new, clean energy equipment such as: 
    • Solar electric panels
    • Solar water heaters
    • Geothermal heat pumps

For additional information regarding the Home Energy Tax Credits, please click here

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