Money Monday: Inflation Reduction Act

Don’t let the Inflation Reduction Act spook you!

NEW in 2022! Tax Credits for Home Owners (including family child care providers)

To support clean energy, the Inflation Reduction Act will extend and expand tax credits for certain energy-related home improvements. This may include energy-efficient:

• Solar panels

• Water heaters

• Heat pumps

• HVAC systems

• Windows

• Doors

• Appliances

• And more! 

Starting in 2023, the Energy Efficient Home Improvement Credit will be equal to 30% of total energy-efficient improvement costs made throughout the year up to a maximum credit of $1,200. This credit is available through 2032.

The Residential Clean Energy Credit offers a 30% credit on the cost to install certain systems that use solar, wind, geothermal, biomass, or fuel cell power to power your home, heat water, or regulate the temperature in your home. This credit is available through 2034.

Although not a tax credit, the High-Efficiency Electric Home Rebate Program will provide rebates to low- and middle-income families who purchase energy-efficient electric appliances. The rebates vary based on the type of appliance and range from $840 - $4,000.

Updates are underway for this new tax law, here is a detailed article on these, and continue to check Energy Star for guidelines and updates.

Thank you to Fred at Keyon & Associates Tax Services for sharing the word about these!