The federal government enacted the Inflation Reduction Act, which promotes clean energy as part of its climate action.
The act incentivizes consumers who switch to clean energy, such as buying electric vehicles and making home improvements with clean energy equipment.
The White House said they would provide incentives in the form of tax credits for taxpayers that install battery storage, solar panels, and other clean energy equipment.
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Homeowners who install solar systems paired with battery storage can claim a tax credit of 30% of the cost. (Photo: Getty Images | Investopedia)
Also Read: Inflation Reduction Act: Washington Provides Tax Credits of Up to $8,000 for Installing Heat Pump
The U.S. Sun reports the Department of Energy indicated the following tax credits available for the 2023 tax season:
- Installing battery storage or solar panels
Households can receive a tax credit of 30% of the rooftop solar costs. This credit is only eligible for solar systems paired with battery storage. It is also available for standalone battery storage without solar.
- Installing Heating, Cooling, and Water Heating
Homeowners who install efficient air conditioners, heating equipment, and water heating equipment can claim a tax credit of 30% of the cost, up to $600
Find Out: Renewable Energy Tax Credit: Taxpayers May Get Up to $8,000 If They Fill Up Form 5695
More: Get Up to $8,000 In Rebates for Upgrading to Energy-Efficient Appliances in Your Home
- Installing other energy efficiency upgrades
Homeowners who replace their appliances or make home repairs with energy-efficient improvements can claim a tax credit. These efficiency improvements include upgrading windows and insulation materials (up to 30% of the cost), exterior doors (30% of the cost, up to $500 or $250 each), and electric panel or circuit upgrades (30% of the cost, up to $600).
Anyone purchasing energy-efficient appliances and products and making home energy and audits can claim the tax credit, including homeowners and renters.
Read More: LIHEAP Application: Energy Assistance Up To $1,200
