The Inflation Reduction Act (IRA) offers significant tax credits and rebates that can help Sarasota-area homeowners make electrical and plumbing home upgrades to boost their energy efficiency.
Created to help Americans reduce the effects of carbon pollution, the IRA also provides tax credits and rebates on qualifying purchases for individual homeowners in the Sarasota area who want to make energy efficient upgrades. Read on to find out more.
How the IRA can save you money on electrical and plumbing home improvements
Replacing old electrical systems or water heaters can save you money on your utility bills. With the tax credits and rebates included in the IRA, you can also save upwards of $17,000 per year for qualifying purchases! Here are some of the upgrades you may consider and how much you can save.
Electrical panel updates
Electrical panels distribute electricity to various parts of your home from the main power supply. In homes that are more than 25 years old, the electrical panel is often part of the original wiring. If you live in an older home, it’s probably time for an upgrade to keep up with all the new appliances that use electricity in today’s households.
Making sure your electrical panels are up to date is an important way to keep your family safe, and, thanks to the IRA, to save money and energy. Call Veteran Air at 941-212-2791 to get an expert assessment of the panel upgrades that are best for your home.
IRA TAX CREDIT FOR ELECTRICAL PANELS: The IRA provides a tax credit of up to $600 for homeowners who upgrade their electrical panels in conjunction with any qualified energy property or upgrade covered in Energy Efficient Home Improvement Tax Credit (25C). See the chart below for more information on the 25C tax credit.
Water Heater Upgrades and Heat Pump Water Heaters
If your water heater is more than 15 years old, you should think about a replacement. Today’s newer models more efficiently, meaning you will use less water and save money on bills.
The most common types of water heaters are:
Conventional water heaters which are fueled by natural gas, oil, or propane, and heat water in a tank so it is ready when you need it.
Heat pump water heaters which work by moving heat from one place to another, rather than directing heat specifically for hot water. This makes them more energy efficient, and you can see significant savings on your energy bill.
The type of water heater you should consider depends on a number of factors, including the size of your home and your typical water usage. The plumbing pros at Veteran Air will inspect your current water heater setup and make a recommendation for what will work best for you. Give us a call today at 941-212-2791.
Inflation Reduction Act TAX CREDIT FOR WATER HEATERS: The IRA provides a tax credit of $600 for water heaters that use natural gas, oil, or propane, and up to $2000 for heat pump water heaters.
Here’s a great savings calculator from Rewiring America that will show you just how much you can save by making energy efficient changes to your home.
IRA 2023 Tax Credits for electrical and plumbing upgrades
Let’s take a deeper look at the tax credits and rebates that are included in the Inflation Reduction Act.
Energy Efficient Home Improvement Tax Credit (25C)
An extension of the existing 25C tax credit, the Energy Efficient Home Improvement Tax Credit allows homeowners to deduct up to 30% of the cost of certain home improvements, capping at $3,200 per year. However, any new appliance installations or home upgrades must meet certain requirements to be eligible for the tax credit. You can see full details about how the Energy Efficient Home Improvement Tax Credit works here.
Veteran Air can provide you with documentation on your new upgrades to claim these credits when you work with us for electrical and plumbing upgrades.
NOTE: We are not tax professionals and cannot provide any tax filing or financial advice.
IRA rebates for electrical and plumbing upgrades
The IRA also includes money for rebates on the purchase of new energy efficient electrical and plumbing appliances and installation. There are two rebate programs, which will be available later in 2023.
The High-Efficiency Electric Home Rebate Act (HEEHRA) offers as much as $14,000 per year in discounts (not tax deductions) on appliances purchased for energy efficient home improvement projects. Depending on your household income, HEEHRA rebates can cover anywhere from 50% to 100% of qualifying costs, up to $14,000!
NOTE: You are allowed to claim both the HEEHRA rebate and tax credits.
The HOMES rebate program encourages energy savings by reimbursing homeowners for whole-house energy improvements. That means you will be able to earn more money back if you install equipment like heat pumps and make electrical upgrades that reduce your home’s energy consumption.
With the HOMES program, the more energy you save, the bigger the rebate. Households that reduce energy use by 20%-35% can save $2000 to $8000!
All Sarasota homeowners qualify for the HOMES rebate, but low- and medium-income households can get more back.
NOTE: The HOMES rebate cannot be combined with the HEEHRA rebates, but can be combined with the Inflation Reduction Act tax credits.
Veteran Air has the electrical, plumbing, and IRA answers you need.
The trusted Sarasota home services experts at Veteran Air know the ins and out of the IRA rebates and incentives that will apply to your situation. Whether you’re looking to make electrical upgrades, find a better water heater for your home, or are looking for expert advice about these kinds of projects, Veteran Air can help you choose the right system for your home and work with you on what IRA tax credits and rebates apply. Contact us today at 941-212-2791 to make an appointment or ask us questions you may have about how you can take advantage of the Inflation Reduction Act.