Ready to make your home more energy efficient? Take advantage of the Inflation Reduction Act which includes a tax credit worth up to $1,200 a year for installing qualified energy efficient home improvements, starting in 2023 and continuing until 2032 so you have 10 years to get energy efficient and use this credit! This tax credit can only be used on your primary home, not rental or commercial property.
In addition, the Residential Clean Energy Credit provides for a tax credit worth 30% of the cost of installing residential solar panels.So for example if you spend $20,000 to install solar panels in 2023, you are eligible for a tax credit of $6,000. The 30% is only available in 2023. Thereafter, the credit drops by a few percentage points each year.
This tax credit replaces the current tax credit which is limited to 10% of the cost of the energy efficient improvements with a lifetime cap of $500.
Remember, a tax credit is more valuable than a tax deduction because it represents a dollar-for-dollar reduction in your tax bill.
So if you are even thinking about doing home improvements, make sure you review the details of these tax credits as they WILL put money back in your pocket.
For any questions or concerns, please reach out to me and we can discuss.