The recently passed Inflation Reduction Act (IRA) brings good news for homeowners looking to upgrade their energy systems. Between now and 2032, you have the opportunity to benefit from various tax credits made available under this new law. One significant change from previous legislation is the removal of a lifetime cap on tax credits. While there's a maximum of $3,200 per year, you can claim this amount annually until 2032. To make the most of these savings, consider spacing out your upgrades wisely. Here's a list of some eligible upgrades.
Energy-efficient home improvement credits and their requirements:

1. Biomass stoves and biomass boilers: You can claim 30% of the costs, including labor, up to $2,000. These systems must meet the highest tier of efficiency standards with a thermal efficiency rating of at least 75%.

2. Central AC: Enjoy a 30% credit for costs, including labor, up to $600, provided your AC unit meets the highest efficiency tier set by the Consortium for Energy Efficiency.

3. Electric or natural gas heat pumps: Similarly, you can get a 30% credit for costs, including labor, up to $2,000, as long as these heat pumps meet the Consortium for Energy Efficiency's top-tier efficiency standards.

4. Electric or natural gas heat pump water heaters: These are also eligible for a 30% credit, covering costs, including labor, up to $2,000, if they meet the highest efficiency standards set by the Consortium for Energy Efficiency.

5. Exterior doors: You can receive a 30% credit for costs, up to $250 per door, with a total limit of $500. These doors must meet or exceed Energy Star requirements.

6. Exterior windows and skylights: Enjoy a 30% credit for costs up to $600 if these windows and skylights meet or exceed Energy Star requirements.

7. Home energy audits: Claim 30% of costs, up to $150, as long as the audit includes a certified home inspection followed by a written report.

8. Insulation: You can get a 30% credit for insulation costs, up to $1,200, provided it meets International Energy Conservation Code standards.

9. Natural gas, propane, or oil water boilers: These are eligible for a 30% credit, covering costs, including labor, up to $600, if they meet the highest efficiency tier set by the Consortium for Energy Efficiency.

10. Natural gas, propane, or oil water heaters: You can claim a 30% credit for costs, including labor, up to $600, if they meet the highest efficiency standards set by the Consortium for Energy Efficiency or meet Energy Star criteria.

11. Electric panels: Enjoy a 30% credit for panel costs, including labor, up to $600, as long as it's installed in accordance with the National Electric Code and has a load capacity of at least 200 amps.

Source: CNET

In addition to these incentives, you can also receive money back from Xcel Energy and/or CenterPoint Energy. Last year, we received a $500 check for installing a tankless water heater. To find out what incentives are available in your area, check this resource by entering your zip code.

Considering going solar? Explore the Residential Clean Energy Credit here. This program offers a tax credit of 30% of the cost of qualifying systems with no cap. If your system costs $20,000 you save $6,000. If your system costs $100,000 you save $30,000. Even if the credit exceeds your tax liability, you can roll over the remaining credit to future years' taxes.

So, take advantage of these opportunities to save on your energy bills, get government assistance, and contribute to a greener Earth. Get started on these home improvements today!