2025 Is Your Final Year to Claim Home Energy Improvement Tax Credits

If you’re thinking about making energy-efficient upgrades to your home, 2025 is your last opportunity to claim up to $3,200 in federal tax credits—thanks to the recently passed One Big Beautiful Bill Act (OBBBA).

But to qualify, your improvements must be installed and in service by December 31, 2025.

What’s Covered?

There are two main tax credits available, depending on the type of upgrade and where it’s installed:

Credit #1: Up to $1,200 per year (Primary Residence Only)

For improvements like:

• Energy-efficient exterior doors (up to $500 total)

• Windows and skylights (up to $600)

• Insulation and air sealing materials

• Qualified furnaces, boilers, AC units, water heaters, and electric panels

Credit #2: Up to $2,000 per year (Primary or Secondary Home)

For high-efficiency systems, including:

• Electric or natural gas heat pumps

• Heat pump water heaters

• Biomass stoves and boilers

Plus, you can also claim a $150 credit for a certified home energy audit—a smart way to identify where your home can save the most.

Important Notes

• These are non-refundable credits—they reduce your tax bill but won’t trigger a refund.

• Only installed systems (not just purchased ones) by 12/31/2025 qualify.

• Any subsidies or rebates (from utilities, for example) must be subtracted from your total cost before calculating the credit.

Don’t Miss This Window

Whether you’re upgrading insulation or investing in a high-efficiency heating system, this is your last year to make it count. Act now, before the credits disappear—and make your home more efficient while cutting your 2025 tax bill.

Upgrade your home. Cut your tax bill. Don’t let these credits expire—make energy-efficient improvements by December 31, 2025, and lock in your savings.