Federal tax credits and rebates can lower the cost of some green home improvements and electric vehicles. Here’s how.
Seiji MatsumotoBy Nadja Popovich and Elena Shao Updated June 13, 2024
Looking to make your home more energy-efficient, install solar panels or buy an electric car? You may be able to save thousands of dollars on climate-friendly purchases through federal tax credits and rebates.
Those savings kicked in last year as part of the Inflation Reduction Act, a law that aims to cut the pollution that is rapidly heating the planet by investing in clean energy across the U.S. economy. The law tackles two major sources of emissions, transportation and buildings, by making it cheaper for Americans to replace fossil-fuel burning cars and appliances, like furnaces and boilers, with cleaner versions, and to make their homes more energy efficient.
Maximizing savings will require planning, experts said.Under the law, many benefits will be available for a decade or more, though not all of them are accessible just yet. Federal tax credits, which allow eligible consumers to recoup some of their expenses, took effect last year. But rebates, which offer up-front discounts or partial refunds, are only available in some parts of the country. That’s because states and tribal governments are working to set up their own rebate programs, with some moving faster than others.
Here’s a quick guide to the savings:
There are plenty of opportunities for homeowners to save money through the new law, but renters will find fewer benefits. Portable appliances, like window-unit heat pumps, are not currently eligible for savings, but that could change in the future.