Dear John,

The Inflation Reduction Act (IRA) was signed into law by President Biden in August 2022. This new law will help spur a clean energy transition and could save you and your family hundreds of dollars a year in energy savings!

Some direct savings for households that the IRA provides include:

Tax Credits for Residential Energy Efficiency Improvements

The IRA provides access to expanded tax credits to households for energy efficiency improvements. Some improvements that qualify for this credit include upgraded windows, doors, insulation, HVAC systems, water heaters, and home energy audits. Homeowners can receive up to 30% back through tax credits for making energy efficiency improvements to their home – up to a maximum of $1,200 per year.

Households can also receive a tax credit of up to 30% of the cost of property for rooftop solar and other residential clean energy systems. Eligible property includes:

· Residential solar and solar water heaters

· Small wind

· Geothermal heat pumps

· Battery Storage

· Fuel cells

· Qualified biomass fuel property

Residential Energy Incentives Q&A

Tax Credits for New Clean Vehicles

You may qualify for a credit up to $7,500 if you buy a new, qualified plug-in electric vehicle (EV or fuel cell electric vehicle (FCV). Qualified manufacturers and further details are listed on the IRS website linked below.

Manufacturers and Models for New Qualified Clean Vehicles

Tax Credits for Used Clean Vehicles

Individuals can also receive a tax credit of up to $4,000 for certain used electric vehicles and plug-in hybrids purchased through a dealership. More details and information on the qualifications can be found on the IRS website linked below.

Clean vehicle purchases made before 2023 do not qualify.

Used Clean Vehicle Credit

Rebates for Residential Energy Efficiency Improvements

The Inflation Reduction Act also establishes two energy efficiency rebate programs that individuals can apply for: the HOME Rebates Program and the High-Efficiency Electric Home Rebate Program. These programs are not yet available to homeowners, but more information on these rebate programs can be found here.

I strongly recommend that you and your family take advantage of these opportunities to reduce your energy footprint and save hundreds of dollars a year. Stay updated with the latest guidance by visiting https://cleanenergy.gov/.

Sincerely,

Mark Takano

Member of Congress