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The Inflation Reduction Act includes an extension for the nonbusiness energy property credit, renamed the energy efficient home improvement credit. The new rules apply to property placed in service after December 31, 2022, and before January 1, 2033. The credit has been increased to 30% and new annual limitations have been implemented depending on the property.
Highlights:
Credit is generally equal to 30% of costs paid or incurred for energy efficient improvements, qualified residential energy property expenditures, and home energy audits.
The energy efficient home improvement credit applies to property installed on or in connection with a home the taxpayer owns and is used as a principal residence.
Credits relating to residential energy property expenditures can be taken on property owned by the taxpayer, whether it is a primary residence or not.
Taxpayers should be careful not to confuse the energy efficient home improvement credit with the residential clean energy credit for alternative energy equipment (e.g., fuel cells, geothermal heat pump systems, etc.).
Follow the link below for more information on the energy efficient home improvement credit: