Uncle Sam Will Help You Pay for Solar Panels and Other Green Home Projects
• 2 min read
- Brief: Taxes
Going green? Uncle Sam will provide tax credits covering some costs of solar panels, energy efficient doors and windows, heat pumps and more.
Get the latest in Research & Insights
Sign up to receive a weekly email summary of new articles posted to AMG Research & Insights.
Now is a great time to make energy efficiency improvements to your home, because the federal government will help you pay for them regardless of your income.
The Inflation Reduction Act of 2022 (IRA) expanded tax credits available to taxpayers who make the following home improvements.
- Solar panels have become increasingly more popular as installation prices have declined and the cost of energy has gone up. In 2023, solar panel installation on a U.S. home costs on average $20,650. That’s down from more than $50,000 a decade ago. Through 2034, the federal tax credit is equal to 30% of expenditures, including labor and sales tax. The credit is reduced by any public-utility rebates but not state tax credits. For example, Frank spends $20,000 on installing solar panels and receives a $1,500 rebate from the electric company. Frank’s total federal tax credit would be $5,550 (($20,000 – $1,500) x 30%). The solar credit also applies to solar water heaters, geothermal heat pumps and fuel cells that meet technical requirements.
- Energy-efficient home improvements, such as doors and windows, now qualify for a 30% credit up to $1,200 annually through 2032. Another $2,000 credit can be claimed for qualified heat pumps, biomass stoves or biomass boilers.
» For more information, visit Home Energy Tax Credits on the IRS website.
AMG Has Your Taxes Covered
Many of our clients choose to take advantage of AMG’s in-house tax department to assist with their personal, corporate, and trust filings.
To better understand the benefits of integrating financial planning, tax planning, trust administration and tax preparation, schedule a free consultation with an AMG advisor.
This information is for general information use only. It is not tailored to any specific situation, is not intended to be investment, tax, financial, legal, or other advice and should not be relied on as such. AMG’s opinions are subject to change without notice, and this report may not be updated to reflect changes in opinion. Forecasts, estimates, and certain other information contained herein are based on proprietary research and should not be considered investment advice or a recommendation to buy, sell or hold any particular security, strategy, or investment product.
Get the latest in Research & Insights
Sign up to receive a weekly email summary of new articles posted to AMG Research & Insights.