President Biden’s Inflation Control Act LaunchedReduce your carbon footprint. A key component of that push is offering up to $14,000 in rebates and tax credits to make homes more energy efficient.
These benefits can be used to reduce the cost of upgrading your home, from installing a heat pump to purchasing new appliances like stoves and dryers. About 40% of our carbon footprint comes from buildings, so incentives like this could help the U.S. reach its goal of reducing fossil fuel emissions, says the nonprofit. said Lauren Urbanek, deputy director of the Natural Resources Defense Federation’s Clean Building Team.
“This gives people very specific and generous incentives in the form of both tax credits and direct cash rebates,” Urbanek told CBS Moneywatch. It’s the biggest investment ever, or at least one designated for climate change.”
Here’s what you need to know about incentives.
What kind of rebates can I receive?
According to NRDC, there are two separate rebate programs.
- HOMES Rebate Program: This will provide the state with more than $4 billion to help residents make their entire homes more energy efficient. This program offers rebates based on the energy savings your upgraded home achieves. For example, homeowners who make changes that reduce energy usage by at least 35% can receive up to $4,000 in rebates. For low- and middle-income households, that amount doubles hers and can receive up to $8,000 in rebates.
- High Efficiency Electric Home Rebate Act (HEEHRA): This provides rebates for low- and middle-income households to electrify their homes, such as by installing heat pumps and electric clothes dryers. Rebates per household are capped at her $14,000, and a household cannot receive two of her rebates for the same upgrade. For example, if you apply for her HOMES rebate program for Heat Pump, you will not receive rebates through HEEHRA.
What kind of upgrades are eligible?
The HOMES rebate program covers upgrades to make your home more energy efficient, from solar panels to new windows.
Under the law, the HOMES rebate should be available for whole home energy efficiency renovations that begin after the Control Inflation Act is passed on August 16, 2022 and are completed by September 30, 2031. However, the program hasn’t started, so while it’s running, we don’t yet know the details of how to retroactively claim rebates.
The HEEEHRA program designates rebates for the purchase of certain appliances and other upgrades. One of the most attractive rebates is the provision of up to $8,000 for heat pumps. Heat pumps, despite their name, provide both air conditioning and heating.
When it comes to energy consumption, these devices are often a better alternative to a stove because they rely on electricity rather than gas or oil to heat your home. Compared to electrical resistance heating such as substrate heaters, the amount of electricity used can be reduced by about 50%. according to to the Department of Energy.
ranging At $4,000 to $7,000+ per unit, heat pumps are quite expensive. Two rebate programs could help offset some or all of the cost of these devices for many consumers.
Rebate caps for other upgrades made through the HEEEHRA program are as follows:
- $1,750 for a heat pump water heater
- $8,000 for heat pumps for heating and cooling
- $840 for electric stove, stove, range, oven and electric heat pump clothes dryer
- $4,000 to upgrade electric road service center
- $1,600 for insulation, airtightness and ventilation
- $2,500 for electrical wiring
The amount of rebates offered under this program is capped at $14,000. For example, low-income homeowners can cover up to 100% of their electrification projects with up to $14,000 in rebates. On the other hand, middle-income consumers can cover up to 50% of their costs in rebates (this is also the cap). $14,000 cap).
To qualify for HEEHRA, you must be 150% or less of your local median income as determined by the Department of Housing and Urban Development.
However, given that the HEEHRA rebate is set up as a POS discount, it is unclear if the HEEHRA rebate will apply retroactively. The Inflation Control Act says the funds will be available to him until September 30, 2031.
What types of tax credits can I receive?
Tax credits are different from rebates because consumers receive them when they file their tax returns. Rebates, on the other hand, are often applied when someone purchases an item. HEEHRA rebates will be available at the point of sale, such as when a consumer purchases a heat pump at a home goods store.
The Inflation Reduction Act expands a homeowner efficiency tax credit called the Energy Efficient Home Improvement Credit. This covers up to 30% of the cost of an energy upgrade, capped at $1,200 per year.
This tax credit, previously available to homeowners, was a lifetime deduction. In other words, it could only be charged once. However, the IRA makes the credit an annual incentive. This means a homeowner can claim credit for upgrading windows one year and buying a heat pump the next.
How do I enroll in these programs?
No rebates or tax credits can be claimed at this time, Urbanek said.
“It will probably still be a few months before the program is implemented,” she said, adding that the HOMES rebate program will likely be run by the state and is currently working to implement the plan.
Similarly, POS rebates are not yet available to consumers, but stores expect to announce details later this year. according to To the publication Clean Technica.
Programs may have different rules
What should I prepare now?
According to experts, there are two steps homeowners can take now to prepare. First, schedule an energy audit for your home. They typically cost around $400 and offer guidance on how to make your home more efficient. according to Go to Home Advisor.
Second, start talking to contractors to line up projects when rebates and tax credits become available.
“By educating yourself about the types of equipment and what you need in your home, you can give people an idea of how to act as soon as this is available,” she said. rice field.
https://www.cbsnews.com/dfw/news/inflation-reduction-act-joe-biden-climate-energy-home-upgrades/ Biden’s Inflation Act provides up to $14,000 for home upgrades. Click here to learn how to qualify.