The Insulation Tax Credit, Explained!
You’re in the right place if you’ve never heard of a tax credit for insulation and air sealing. Not every contractor understands how to simplify tax credits for their customers, but we do! Keep reading to learn more about a tax credit, what upgrades are available, and how Millers can help you benefit.
Insulation Tax Credits vs. Rebates for Insulation: What’s the Difference?
Tax credits and rebates are incentives that help make energy-efficient home improvements more affordable, but they work in slightly different ways.
With a tax rebate, you receive money back after the purchase of qualifying products and/or services. This rebate can be an immediate discount at the time of sale or a refund that is sent to you after your purchase has been processed and approved.
A tax credit reduces the amount of income tax you owe during tax return season. You will see your savings when you file your federal taxes and claim your insulation credit.
Is the Insulation Tax Credit New? Why Haven’t I Heard About It Before?
Created over a decade ago, the Energy-Efficient Home Improvement Tax Credit, which is sometimes called the 25C tax credit, has undergone several revisions over the years as new laws have been passed. The most recent change has declared that the program will end as of December 31, 2025.
What Home Improvements Are Tax Credit-Eligible?
The Energy-Efficient Home Improvement Tax Credit doesn’t just apply to insulation and air sealing. Several eligible services qualify, including:
- Windows and doors
- Furnaces, air conditioners, and boilers
- Water heaters and heat pumps
- Electrical panel upgrades
Heat pumps and water heaters have a $2,000 limit under the tax credit program, which is separate from the combined $1,200 annual maximum that covers all of the improvements listed above. This means you could claim as much as $3,200 for this year if you upgraded your insulation and installed a heat pump.
Enjoy the Benefits of the Insulation Tax Credit
Upgrading your home’s insulation and air sealing lowers your heating and cooling bills, makes your home more comfortable, and is good for the environment! Even better, insulation tax credits reduce your upfront costs.
Here are some of the highlights:
- Claim up to $1,200 a year for insulation and air sealing home improvements
- As long as you owe federal taxes, you can benefit!
- Can be combined with other tax rebates and incentives
Claiming this tax credit is easy with Millers. Reach out today to learn more about the benefits of insulation and air sealing upgrades for your home and see how much you can save with energy efficiency incentives.
Work With an Insulation Company That Understands Tax Credits
The Energy-Efficient Home Improvement Tax Credit is easy to qualify for, as long as you work with an insulation company that understands the rules and is committed to making the process simple for you!
At Millers, we provide an itemized invoice, identifying tax credit-eligible expenses and everything you need when it comes time to file. Our team is well-trained on insulation tax credits, can answer any tax credit questions you have, and will ensure you get ALL of the credit you are eligible for!
*We always recommend hiring a tax professional when filing your taxes, especially when there are significant incentives at stake!
Find out how much you save with tax credits when you upgrade your New Mexico home’s insulation. Call 505-544-5083 or contact us online to learn more.
