Home Energy Tax Credit Calculator

Two federal tax credits, Section 25C and Section 25D, rewarded energy-efficient home upgrades, but both expired for property placed in service after December 31, 2025 under the One Big Beautiful Bill Act. This tool estimates what each credit would have been worth, which helps when reviewing a project completed through 2025 or weighing whether today's state and utility incentives make a comparable upgrade worthwhile. The credits offset what you owed dollar for dollar rather than just lowering taxable income.

Through 2025, the Energy Efficient Home Improvement Credit under Section 25C returned 30% of the cost of qualifying efficiency upgrades, capped at $1,200 a year for most work, with smaller limits inside that cap ($600 per item of energy property such as a central air conditioner, $600 for all windows and skylights, $250 per exterior door up to $500) and a separate $2,000 yearly limit for heat pumps, heat pump water heaters and biomass stoves or boilers. The Residential Clean Energy Credit under Section 25D returned 30% of the cost of new clean energy property installed at your home, with no annual or lifetime cap. The calculator handles one improvement at a time: pick the type, enter the cost, and it applies 30% and that item's cap under the rules that applied through December 31, 2025. For a project with several items, run each one and add the results, keeping the 25C items within the $1,200 and $2,000 annual limits.

Because these are credits, they cut your actual tax bill dollar for dollar instead of reducing what is taxed. Hold on to every invoice and receipt tied to the improvements, since you will need them when you file. Eligibility and the final credit amount depend on the specifics of your return, so treat this as an estimate and check with a qualified tax professional before relying on it.