Sustainable homes are designed to minimize their impact on the environment. They use less energy, water, and materials than traditional homes, saving homeowners money on their utility costs. Beyond cost savings, energy-efficient homes reduce pollution and conserve natural resources, are more comfortable year-round, improve air quality, and increase property value.

The Inflation Reduction Act of 2022 provides federal tax credits and deductions that empower Americans to make homes and buildings more energy-efficient to help reduce energy costs while reducing demand as we transition to cleaner energy sources.

New federal income tax credits are available through 2032, providing up to $3,200 annually to lower the cost of energy-efficient home upgrades by up to 30 percent. The tax credits cover improvements such as installing heat pumps, heat pump water heaters, insulation, doors and windows, electrical panel upgrades, home energy audits, and more. They can help families save money on their monthly energy bills for years to come.

In addition to the energy efficiency credits, homeowners can also take advantage of the modified and extended Residential Clean Energy credit, which provides a 30 percent income tax credit for clean energy equipment, such as rooftop solar, wind energy, geothermal heat pumps and battery storage.