energy star

Federal and State Tax Credits and Incentives

Federal Residential Incentives

For certain efficient home improvements, you can receive a federal tax credit equal to 30‰ with a cap at $1500 for the purchase of energy efficient technologies such as

  • Water Heaters
  • Furnaces
  • Boilers
  • Heat Pumps
  • Air Conditioners
  • Insulation
  • Windows
  • Doors
  • Roofs
  • Stoves that use qualified Biomass Fuel
The equipment must be new and in compliance with all applicable performance and safety standards as described in the tax code.

Federal Renewable Energy Tax Credits

For homeowners interested considering onsite renewable energy generation, the federal government has gone above and beyond to encourage the use of renewable energy by giving some generous tax credits. For systems installed after 2008, you are eligible for a tax incentive equal to 30% of the cost of the system and their is no cap. You can also include the cost of having them installed. Included in this credit are:

  • Solar Electricity Systems or Photovoltaic Systems
  • Solar Water Heating Systems
  • Small Wind Systems that generates less than 100 kilowatts
  • Energy Star Approved Geothermal Heat Pumps

State Energy Efficiency Incentives

Many states offer additional financial incentives to individuals who make energy efficient home improvements. For example, the state of Texas gives a property tax exemption for those with renewable energy generation systems such as wind and solar systems. If adding these systems to your property increases your homes value, your property taxes will be exempt of the amount of the increase that arises.

Texas also has an annual 3 day tax holiday over Memorial day weekend which allows the purchase of technologies such as clothes washers, dryers, dishwashers, air conditioners and more to be exempt of paying any sales tax on that purchase. These appliances must meet the energy star efficiency requirements.

To learn more about Incentives in your State, visit the Database of State Incentives for Renewable's & Efficiency