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Inflation Reduction Act Tax Incentives
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Inflation Reduction Act Tax Incentives

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Home Efficiency Upgrades: IRA Tax Credits are Available Now

Information last updated August 4th, 2023
Inflation Reduction Act Tax Credits

Maximize your savings with home efficiency updates.

The Inflation Reduction Act (IRA) makes energy-efficient home upgrades simple and more affordable. A more efficient home can reduce your energy costs, lower carbon emissions and improve your family’s comfort. OPPD is your trusted resource for IRA tax credits, helping you make informed decisions and connecting you with OPPD-certified Trade Allies who can complete your updates.

Always refer to a trusted tax professional for personal advice and eligibility on any tax credit.

IRA upgrades could save the average taxpayer up to $1,000 on annual energy cost by 2030. Department of Energy, 2023.

WHY UPGRADE?

New energy-efficient technologies are safer, use less power, and are more affordable, thanks to the IRA. They can even help lower utility bills, reducing your overall energy costs. Ready to upgrade your home with a new heat pump, central air-conditioner, or solar panels? Locate a Trade Ally today.

Click to find a trade ally

Heat Pumps: Heat Pumps are 2-3 times more efficient than traditional systems, offering gentler, more natural heating/cooling with reduced emissions and energy costs. Up to $2,000 tax credit*     Central Air Conditioning (AC): High-efficiency HVAC systems can increase household comfort and save money on energy bills year after year. Up to $600 tax credit*     Solar Power: Solar generation can offset household electric costs and provide a source of backup power. Customers who generate surplus power can earn money through OPPD's community net-metering program. 30% tax credit* on rooftop solar installation

*Credit amounts/limits are subject to change. Verify current information with the IRS Inflation Reduction Act page, and consult with an OPPD-certified Trade Ally before making any final decisions.

 

More About IRA Residential Tax Credits

Most IRA credits allow you to claim 30% of installation costs on certain energy-efficient home upgrades as dollar-for-dollar reductions on your taxes that year. You can only claim so much per year, but many credits will be available to claim for several years (some until 2031) and can be claimed multiple times for qualifying work performed during the tax-year.

The categories below provide a basic overview of the currently available credits. Always consult with your tax professional about your eligibility for credits on specific upgrades you’d like to make for your home.

Heating & Cooling Upgrades

Upgrading your home's HVAC system or water heater can result in big savings on your energy bill. Some modern heating/cooling equipment (like heat pumps) are 2-3 times more efficient than 20th-century climate-control solutions.

The IRA offers homeowners with energy-efficiency tax credits on qualifying new central A/C units, water heaters, furnaces, boilers and heat pumps. OPPD also has HVAC Smart Rebates available to help you offset the up-front costs of upgrading home’s efficiency.

Upgrade: Biomass Stoves - Incentive Amount: 30% of materials and labor costs, maximum of $2,000. Requirements: Must meet Consortium for Energy Efficiency's (CEE) highest tier of efficiency and have a thermal efficiency rating of at least 75%. Upgrade: Central AC (Note: May be eligible for an additional $700 rebate from OPPD click to learn more). Incentive Amount: 30% of materials and labor costs, maximum of $600. Requirements: Must meet CEE's highest tier of efficiency. Upgrade: Electric/Natural Gas Heat Pumps. Incentive Amount: 30% of materials and labor costs, maximum of $2,000. Requirements: Must meet Energy Star (ES) requirements. Upgrade: Natural Gas/Propane/Oil Heaters. Incentive Amount: 30% of materials and labor costs, maximum of $600. Requirements: Must meet CEE's highest tier of efficiency.

Electric Vehicles

Most people are most interested to learn if there will be tax credits for electric vehicles. The answer is: yes! Qualifying households may be eligible to claim up to $7,500 on a new plug-in electric vehicle (EV) or fuel cell vehicle (FCV) and up to $4,000 on used EVs. 

Check out OPPD’s Guide to Electric Vehicles to learn more about EVs in the Omaha area, and for advice on selecting the right vehicle for your lifestyle!

Upgrade: Biomass Boilers. Incentive amount: 30% of materials and labor costs, maximum of $2,000. Requirements: Must meet CEE's highest tier of efficiency and have a thermal efficiency rating of at least 75%. Upgrade: Natural Gass/Propane/Oil Water Boilers. Incentive Amount: 30% of materials and labor costs, maximum of $600. Requirment: Must meet CEE's highest tier of efficiency. Upgrade: Natural Gas/Propane/Oil Water Heaters. Incentive amount: 30% of materials and labor costs, maximum of $600. Requirements: Must meet CEE's highest tier of efficiency. Upgrade: New Electric Vehicles (note: See more information on EV's here.) Incentive Amount: Up to $7,500 tax credit. Requirements: Income and MSRP limitations apply. Upgrade: Use Electric Vehicles. Incentive Amount: Up to $4,000 tax credit. Requirements: Income and MSRP limitations apply. Upgrade Solar Water Heaters. Incentive Amount 30% of materials and labor costs. Requirements: Must meet Solar Rating Certification Corporation requirements.

Home Exterior Efficiency Upgrades

Your home develops drafts as it ages from settling and general wear—and simple repairs can only go so far. IRA tax credits are available that help reimburse homeowners for making energy-efficient upgrades to their insulation, windows, and exterior doors. Not only can this help reduce your energy costs by 10-20%, but you’ll enjoy more comfortable indoor spaces that are easier to keep at a consistent temperature.

Upgrade: Electric Panels. Incentive Amount: 30% of materials and labor costs, maximum of $600. Requirements: Must be installed in accordance with the National Electric Code and have a load capacity of at least 200 amps. Upgrade: Exterior Doors. Incentive Amount: 30% of materials and labor costs, $250 per door, maximum of $500. Requirements: Must meet or exceed ES requirements. Upgrade: Exterior Windows, Skylights. Incentive Amount: 30% of materials and labor costs, maximum of $600. Requirements: Must meet or exceed ES requirements. Upgrade: Home Energy Audit. Incentive Amount: 30% of materials and labor costs, maximum of $150. Requirements: Must include home inspection and written report by certified auditor. Upgrade: Insulation. Incentive Amount: 30% of materials and labor costs, maximum of $1,200. Requirements: Must meet international Energy Conservation Code standards.

Clean Energy Generation & Storage

Home solar is becoming more reliable and realistic every year and the IRA tax credits make it easier than ever for the average homeowner offset their everyday energy cost with clean energy. Solar panels and wind turbines provide renewable power with home batteries to store them. Excess energy? OPPD’s net-metering program allows you to sell back your clean surplus and earn credits to reduce your bill.

Offset your energy costs by generating power through systems like solar panels or wind turbines. If you generate more than your home needs, you can store it in a home battery backup system or earn money by selling it to OPPD through our net-metering program. OPPD also has Solar Rebates available to help you offset the up-front costs of home solar.

Upgrade: Battery Storage. Incentive Amount: 30% of materials and labor. Requirements: Minimum generating capacity of three kilowatt-hours. Upgrade: Fuel Cells. Incentive Amount: 30% of materials and labor costs, maximum of $500 per each half kilowatt of capacity. Upgrade: Small Wind Turbines. Incentive Amount: 30% of materials and labor costs. Requirements: Maximum generating capacity of 100 kilowatts. Upgrade: Solar Systems (Note: May be eligible for an additional $2,000 rebate from OPPD! Click to learn more.) Incentive Amount: 30% of materials and labor costs. Requirements: Must meet Solar Rating Certification Corporation requirements.

IRA Resources

Learn more about the IRA and its included upgrades by exploring the following sources:

Department of Energy IRA FAQ
EnergyStar IRA Homeowner Tax Credit Guide
Internal Revenue Service IRA FAQ
Rewiring America
Text of the Inflation Reduction Act

IRA Upgrades Icon 

Download a list of the available IRA upgrades.Click here to download now

 

Still Have Questions?

You can always email customerservice@oppd.com or call 402-536-4131.