Each year, as a way to spur energy-efficiency across the US, the Federal government offers US homeowners tax credits for certain home improvements. Federal tax credit for window replacement is one of the more prominent tax credits offered as well as one of the most overlooked tax credits by homeowners.
One of the main benefits in federal tax credit for window replacement is that it allows for homeowners who replaced windows in their home in the past several years with qualified windows to retroactively claim tax credits in the current year. So whether you purchased replacement windows in the past or are considering window replacement in the future make sure you check to see if you qualify for federal tax credit for window replacement in the description below.
Here’s a brief overview of how to qualify for federal window rebates:
ENERGY STAR Rebates
If you replaced any windows or installed new replacement windows that meet Energy Star standards, you are eligible for a tax credit. In fact you don’t even need to replace all of your windows at once to qualify. And believe it or not you can claim the federal tax credits for windows / Energy Star rebates even if you installed a new window where there wasn’t one before!
To qualify for the Energy Star rebate you must meet the following requirements:
- The windows need to be installed in the homeowner / taxpayer’s primary residence
- Windows must have been installed after January 1, 2012
Homeowners are eligible to receive a tax credit equal to 10% of the product cost (installation costs are not included in the rebate calculation) with a maximum federal tax credit of no more than $200.
In total, homeowners may receive no more than $500 in total energy efficiency tax credits.
So whether you are shopping for new windows to install yourself or hiring a local replacement windows installation company make sure your windows are Energy Star approved and include the ENERGY STAR label to qualify for all associated federal tax credits and Energy Star rebates.
You can find the best prices from local Energy Star window installation companies here.
Inflation Reduction Act of 2022
In late 2022 a new climate bill was signed into law that can help Americans save money on energy bills, in particular allowing homeowners to obtain tax credit for window replacement 2022.
The Inflation Reduction Act is one of the largest climate change bills in American history. The bill provided financial incentives for purchasing energy efficient windows, solar panels, electric vehicles and high-efficiency appliances.
This “nonbusiness energy property credit” comes in the form of a 30% tax credit that is worth as much as $1,200 per year. It can be used to defray the cost of installing energy-efficient windows, skylights, insulation and doors.
The tax credit applies to projects that are completed after January 1, 2023, and before the close of 2033. However, costs that are incurred in 2022 for a project that is finished in 2023 will still count toward the homeowner’s overall tax break.