Making energy-efficient upgrades to your home may not be the most glamorous project, but the US government is making it a bit more attractive.
In an attempt to reduce fossil fuel consumption, the government will soon start reimbursing you for energy-efficient home improvements.
It is part of the Inflation Reduction Act of 2022 that was signed into law. By taking advantage of the incentives and rebates, you could save money now and later.
In fact, if you took advantage of all the rebates available from the government, you could save up to $14,000 while at the same time improving your home and lowering your energy bills.
For those interested, here’s more info on how to get the IRA rebate, via CNET:
The IRA offers rebates for new technology and for sealing and insulating a home. Within a certain income bracket, you can get $8,000 back for a heat pump, $1,750 for a heat pump water heater and $840 for an electric range or oven and electric heat pump clothes dryer. Because adding hefty electrical appliances might overwhelm an older home’s electrical infrastructure, the bill also offers $4,000 for upgrading an electrical panel and up to $2,500 for wiring work. You can also get back up to $1,600 of the cost of insulation or air duct sealing, which will improve the efficiency of your heating and cooling system.
Households pulling in 80% to 150% of an area’s median income can get back 50% of the cost of these projects, up to the limits for individual items and up to $14,000 total. Households making below 80% of the median income can get back 100% of the cost.
The IRA also makes significant changes to a more familiar tax credit. Under the new rules, the federal solar tax credit for residential solar gets boosted from 26% to 30% and is locked in through 2032. It drops to 26% in 2033 and 22% in 2034. Before, the credit was at 26% and set to decrease to 22% in 2023 before disappearing altogether.
The IRA also creates tax credits for 30% of the cost of energy-efficiency improvements, including new windows ($600), doors ($500) and heat pumps ($2,000). Homeowners can claim up to $1,200 per year back on their taxes. Credits for efficiency decrease on the same schedule as solar.
Every state is responsible for administering their own rebates, so depending on where you live the process will vary.
As for when the rebates and tax incentives will be available… the government said most will begin in 2023.
So if you are looking to make your home more energy-efficient and want the government to help pay for it, make sure you look into this.