The government offers a federal tax credit for anyone buying or switching to green technology under the Inflation Reduction Act of 2022.The IRS indicated one of its provisions is eligibility guidelines to claim a tax credit for clean energy vehicles or home improvements.
Congresswoman Haley Stevens said that the act offers up to $7,500 tax credit for buying an eligible new clean vehicle and up to $4,000 for an eligible used vehicle. The government also provides up to 30% tax credits for homeowners who switch to energy-efficient home improvements. The federal government leaves it up to the states to implement and make a rebate program for their constituents.
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The state of Oregon offers a subsidy program for purchasing electric bikes – which was not included in the Inflation Reduction Act. A proposed bill in the state indicates a rebate of up to $1,200 off for purchasing an eligible electric non-cargo bike and up to $1,700 off for an eligible electric cargo bike.
Workers install a heat pump in Seattle. Heat pumps have less carbon footprint than furnaces. (Photo: The New York Times)
Meanwhile, some states have also started implementing a rebate program for homeowners who switch from gas to electric home improvements.
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In Washington, the fund from the Inflation Reduction Act will be used for a high-efficiency residential electrification program. MRSC reports homeowners who install a heat pump can get a tax credit of up to $8,000 for low-income households and up to 2,000 for non-income eligible households. The tax credit will become available in 2023 and applies to equipment installed in January 1 or later.
KOMO News reports installing a heat pump is more efficient in terms of cost and energy, which is an advantage in the surging inflation across the country. In contrast, furnaces are costly as they consume 20% of energy and gas prices continually increase more than electricity prices. A heat pump also produces less pollution compared to gas furnaces.
