Energy Tax Credits for Home Improvements

It's time to get ready for the next tax season by knowing what home improvements you can make to qualify for energy tax credits.

tax deductible home improvements

Home improvements are more affordable and beneficial for you if you go with ones that fall under the

Non-business energy property credit and the residential energy efficient property credit. So, let's jump in and get started.

Table of Contents

Non-Business Energy Property Credit

With this credit, homeowners can claim 30% of eligible home improvements (excludes labor/installation fees).

  • Qualified energy efficiency improvements – Insulation, exterior windows, storm windows/doors, metal, and certain asphalt roofs
  • Residential energy property expenditures – electric heat pumps, central air conditioning, natural gas/propane/hot water boilers, natural gas/propane/oil furnaces, advanced main air circulating fan used in natural gas/propane/oil furnaces, and biomass fuel stoves.

The non-business energy property credit has a limit of $600.

  • $600 on new windows
  • $50 on advanced primary air circulating fan
  • $150 on qualified natural gas, propane, or hot water boiler
  • $300 on energy-efficient building property

How to Claim the Residential Energy Efficient Property Credit        

Homeowners can claim 30% of the cost of alternative energy equipment installed in or on their homes for the following things:

  • Solar electric property
  • Solar water heating property
  • Fuel cell property
  • Small wind energy property
  • Geothermal heat property

This credit has no dollar limit for many property types. If the credit exceeds the amount that you owe in taxes, you can claim the unused portion the following year during tax season.

However, this excludes the fuel cell property, which has a $500 cap for each one-half kilowatt of capacity of the property.

To claim the residential energy tax credit, file your taxes online and get all the tax credits and deductions you qualify for. A bigger tax refund is made possible when you claim all the credits you deserve!

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