Energy Efficient Home Improvement Tax Credit

Last reviewed: October 22, 2026.

Current Status of the Federal Credit

The federal Energy Efficient Home Improvement Credit (Section 25C) ended for property placed in service after December 31, 2025. A new installation completed in 2026 does not qualify for this credit. Earlier guidance describing availability through 2032 is no longer current. See the IRS credit guidance.

Reviewing an Eligible 2025 Installation

For eligible improvements completed during the qualifying period, the credit generally equaled 30% of qualified costs, subject to annual and equipment-specific limits. The annual limits included up to $1,200 for certain improvements and up to $2,000 for qualified heat pumps, heat-pump water heaters, and biomass equipment. Eligibility depended on the equipment, efficiency standards, home, installation date, and documentation. It was nonrefundable and unused amounts could not be carried forward.

Keep invoices, installation records, and applicable manufacturer information. Ask your tax professional about your circumstances and the correct Form 5695 requirements; equipment purchase alone does not establish eligibility.

Planning a Home Comfort Upgrade Now

Compare equipment efficiency, sizing, installation cost, and operating needs when planning an upgrade. Ask Fante’s about current offers and any utility or manufacturer programs available for your project; these are separate from the expired federal credit and must be verified individually.

Contact Fante’s for help evaluating heating, cooling, or water-heater equipment and installation options.