If you are considering renovating your home, now might be the best time to start planning. According to the State of Washington, funds will be available in 2024.
The Inflation Reduction Act (IRA) offers up to $14,000 in tax rebates and credits for low- and moderate-income homeowners, as long as your renovations increase the energy efficiency of your home. This saves you money twice: once for the credits and later when you pay less for energy costs.In addition to a $150 tax credit for a home energy audit, some examples of upgrades that are part of the IRA include:

• Electric appliances. Homeowners can receive up to $8,000 in rebates for energy-efficient appliances, depending on their income levels. Some rebates can also cover the installation costs for qualifying appliances. Appliances like heat pumps, water heaters, electric stoves, cooktop range or oven with induction, clothes dryers are included.
• Insulation. Insulation can provide significant savings on your energy bill, plus some families can receive 30% tax credit for upgrading insulation, including the installation on efficient windows and doors, and up to a $2,000 credit to buy an electric heat pump.
• Solar panels. A Forbes article reported that installing solar panels can cost between $6,600 and $22,800. The IRA tax credit offers a 30% tax credit on rooftop solar panel installation. Solar panels will reduce your energy bills and may increase the value of your property.
• Wind turbines and battery storage are alsoeligible for a tax credit.
• Other upgrades: Consider upgrading your electric panel and circuits for new electric equipment.

For residents of Washington, IRA point of sale rebates will be administered through the State of Washington. The tax credits come through the federal IRA program. Be sure to check with the State of Washington on availability of rebates before scheduling your projects, as “projects eligible for these rebates will be those initiated after the states have federal funding, meaning that eligible purchases will likely need to be made after the program officially launches in Washington. However, the federal tax credits renewed under the IRA are currently in effect, meaning purchases in 2023 qualify for these tax credits.”

More information about the Inflation Reduction Act of 2022:

• Federal Funding for Buildings – Washington State Department of Commerce
• INFLATION REDUCTION ACT OF 2022 | Department of Energy
• US Department of Energy’s Clean Energy Tax Credit webpage.
• You may want to consider consulting a licensed tax professional for information about your particular situation when it comes to tax credits.