Federal Income Tax Credits and Incentives for Energy Efficiency

When you file your 2022 federal taxes, you will want to realize the benefits of your home’s energy efficiency. Several changes to the tax code for homeowners that took effect in 2019 remain available for the 2022 tax year. Newly passed legislation will cover energy-related tax credits and rebates starting in the 2023 tax year. The federal government offers tax credits to homeowners to offset the costs of energy-efficient home improvements. This credit can be claimed on your tax return which may reduce the federal taxes you pay as a homeowner.

Eligible Energy-Efficient Home Improvements:

  • central air conditioners
  • natural gas, propane, or oil water heaters
  • natural gas, propane, or oil furnaces and hot water boilers
  • electric or natural gas heat pump water heaters
  • exterior doors (30% of costs up to $250 per door, up to a total of $500)
  • exterior windows and skylights (30% of costs up to $600)
  • insulation materials or systems and air sealing materials or systems (30% of costs).
  • home energy audits (30% of costs up to $150

The Internal Revenue Service released a fact sheet to the public on December 22, 2022.   https://www.irs.gov/pub/taxpros/fs-2022-40.pdf


“The energy-efficient home improvement credit is a $ 500 lifetime credit through December 31, 2022.  As amended by the IRS, the energy-efficient home improvement credit is increased for years after 2022, with an annual credit of generally up to $1,200. Beginning January 1, 2023, the amount of the credit is equal to 30% of the sum of amounts paid by the taxpayer for certain qualified expenditures, including (1) qualified energy efficiency improvements installed during the year, (2) residential energy property expenditures during the year, and (3) home energy audits during the year. There are limits on the allowable annual credit and on the amount of credit for certain types of qualified expenditures (see Energy Efficient Home Improvement Credit: Qualifying Expenditures and Credit Amount questions 1 and 2). The credit is allowed for qualifying property placed in service on or after January 1, 2023, and before January 1, 2033.

The residential clean energy property credit is a 30-percent credit for certain qualified expenditures made by a taxpayer for residential energy efficient property. The IRA extended the residential clean energy property credit through 2034.”

IRS Form 5695 Residential Energy Credits will assist you in your federal tax filing process. Go to www.irs.gov/Form5695 for instructions and the latest information.

Contact Schneider Heating & Air Conditioning for a consultation and take the first step to improved home energy efficiency.

Schneider Heating & Air Conditioning is the leader in heating, cooling, ventilation, and air quality products and services in the La Crosse area. We have been serving the Coulee Region for more than 80 years. Our technicians are highly and continually trained utilizing the most sophisticated HVAC (Heating, Ventilation, and Air Conditioning) technologies and equipment. All of our service technicians are NATE (North American Technician Excellence) certified—the largest non-profit certification organization that is governed, owned, operated, developed, and supported by the HVAC industry. At Schneider Heating & Air Conditioning, we pride ourselves on amazing customer service. Contact us today.