In July 2022, Congress made headlines with the largest climate package ever passed in U.S. history. This Inflation Reduction Act offers homeowners thousands of rebates and tax credits to make their homes more environmentally friendly.
In 2023 alone, 3.4 million Americans took advantage of $8.4 billion in tax credits and made energy efficiency improvements in their homes, according to the White House. According to the U.S. Treasury Department, the 725 applications received resulted in a capacity savings of 170 megawatts on the first day of the application window.
This law was not only a huge plus for homeowners, but also for the environment. The only downside is that there are rumors that this will be reversed in Donald Trump's upcoming second term. While amending the IRA requires an act from Congress, its future is still uncertain as both the House and Senate have Republican majorities.
Depending on your income, you could save up to $8,000 per household as long as you reduce your home's energy consumption by 20%. If you upgrade your equipment – such as your electrical panel, insulation and major appliances – you may also be eligible for refunds of up to $14,000.
In some states, these discounts are a little difficult to obtain, but there are organizations that can help, including Rewiring America. This nonprofit organization provides tools to help consumers determine their savings potential, redeem their rebates, and find local, affordable contractors to upgrade their homes.
The more we convert our homes to clean energy, the more we can reduce our overall carbon footprint and help cool the planet. Upgrading appliances, like this couple who got a $500 discount when they upgraded their stove, driving electric cars, and insulating your home to reduce electricity usage are also proven ways to save hundreds of dollars per month to save.
If you want to take advantage of this offer to help your household go green, you need to act very soon. This guide can help you determine how much tax relief you can get with an IRA.
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