Federal tax credits

Federal home energy tax credits ended after 2025

The 25C and 25D credits paid 30% of efficiency upgrades and clean-energy systems. Public Law 119-21, signed July 4, 2025, ended both for work after December 31, 2025, seven and nine years early. Work done in 2025 is still claimed on your 2025 return with IRS Form 5695.

Closed 25C: ended — not allowed for property placed in service (or expenditures made) after Dec. 31, 2025; 2025 work is still claimed on 2025 returns (Form 5695).

Closed 25D: ended — not allowed for expenditures made after Dec. 31, 2025.

IRS FS-2025-05 ↗ · verified October 12, 2026

An energy advisor’s kit on a front-hall bench: infrared camera, pressure gauge with tubing, tape measure, headlamp and a floor sketch

What ended, and when

25C · Efficiency upgrades and the $150 audit credit

Energy Efficient Home Improvement Credit

Closed ended — not allowed for property placed in service (or expenditures made) after Dec. 31, 2025; 2025 work is still claimed on 2025 returns (Form 5695)

IRS 25C page ↗ · IRS FS-2025-05 ↗ · Public Law 119-21 ↗ · verified October 12, 2026

Last eligible
Property placed in service on or before Dec. 31, 2025 (statute: not allowed 'after December 31, 2025'). Note: the IRS 25C page uses both 'through December 31, 2025' and 'before December 31, 2025'; the statute and FS-2025-05 use 'after December 31, 2025'.
Paid when open
For 2023-2025: 30% of qualified costs. Annual cap $1,200 for efficiency property and improvements, with sub-limits: exterior doors $250 each / $500 total; windows and skylights $600; home energy audits $150; residential energy property (e.g., central AC, gas/propane/oil water heaters meeting the CEE top tier) up to $600 per item. Separate annual cap of $2,000 for qualified heat pumps, heat pump water heaters, biomass stoves and boilers. No lifetime limit; nonrefundable. Property placed in service in 2025 required the manufacturer's QMID on the return.
What changed
Public Law 119-21 (signed July 4, 2025), Sec. 70505, moved the credit's end date from Dec. 31, 2032 to Dec. 31, 2025 (the IRA had extended it through 2032). It also rewrote the oil furnace/boiler definition. IRS FAQ FS-2025-05 (Aug. 21, 2025): 'The credit will not be allowed for any property placed in service after December 31, 2025.' Because of the early termination, manufacturers no longer need to file periodic written reports, though the QMID rule applied to 2025 property.

25D · Solar, batteries, geothermal and other clean-energy systems

Residential Clean Energy Credit

Closed ended — not allowed for expenditures made after Dec. 31, 2025

IRS 25D page ↗ · IRS FS-2025-05 ↗ · Public Law 119-21 ↗ · verified October 12, 2026

Last eligible
Expenditures made by Dec. 31, 2025. An expenditure is treated as made when original installation is completed, so paying in 2025 for a system installed in 2026 does not qualify (IRS FS-2025-05, Q7). For construction or reconstruction, it is made when original use of the structure begins.
Paid when open
30% of the cost of new qualified clean energy property for 2022-2025, with no annual or lifetime dollar limit: solar electric panels, solar water heaters, wind turbines, geothermal heat pumps, fuel cells, and battery storage (from 2023).
What changed
P.L. 119-21 Sec. 70506 replaced the end date of 'property placed in service after December 31, 2034' with 'any expenditures made after December 31, 2025', and removed the scheduled step-downs to 26% (2033) and 22% (2034).

45L · Paid to builders of efficient new homes

New Energy Efficient Home Credit (paid to builders, not homeowners)

Closed ended — not allowed for homes acquired after June 30, 2026

IRS 45L page ↗ · Public Law 119-21 ↗ · verified October 12, 2026

Last eligible
Qualified new energy efficient homes acquired on or before June 30, 2026.
Paid when open
Homes acquired 2023 through June 30, 2026: up to $5,000 per home. Single-family and manufactured homes: $2,500 for meeting the ENERGY STAR program requirement, $5,000 for Zero Energy Ready Home certification. Multifamily units: base $500 / $1,000 (other multifamily amounts, e.g. with prevailing wage, not confirmed in our check). Homes acquired before 2023: $1,000 or $2,000.
What changed
P.L. 119-21 Sec. 70508 changed the termination date from Dec. 31, 2032 to June 30, 2026.

The $150 home energy audit credit

25C included up to $150 a year for a home energy audit of your main home, within the $1,200 annual cap. From 2024, the audit had to be done by, or under the supervision of, a qualified home energy auditor certified through a DOE-recognized program, with a signed written report giving the auditor’s name and EIN or TIN, an attestation of certification and the program’s name (IRS Notice 2023-59).

It doesn’t apply to audits paid for or done after December 31, 2025. The IRS instructions for 2025 and the draft 2026 Form 5695 say the credit can’t be claimed for expenditures or property placed in service after that date. An audit done in 2025 is claimed on the 2025 return.

Audits still pay off in other programs

Utility and state efficiency programs often pay for most or all of an assessment. Mass Save in Massachusetts offers a no-cost assessment; Energize Connecticut’s visit has a $40 copay (no cost below 60% of state median income); Minnesota’s Home Energy Squad charges $100 or $70, free for income-qualified households under 80% of area median income. HOMES rebates also start with an energy assessment.

DOE qualified certification programs ↗ · verified October 12, 2026

What an audit costs → Find a certified auditor →

What you can still claim on a 2025 return

  1. 25C improvements placed in service on or before December 31, 2025. 30% of qualified costs, up to $1,200 a year plus up to $2,000 for heat pumps, heat pump water heaters, biomass stoves and boilers. Property placed in service in 2025 needed the manufacturer’s QMID on the return. The credit is nonrefundable.

  2. A home energy audit done in 2025, up to $150, with the qualified auditor’s signed written report.

  3. 25D systems whose installation was completed by December 31, 2025. 30% of the cost, with no annual or lifetime dollar limit. Paying in 2025 for a system installed in 2026 doesn’t qualify. For new construction or reconstruction, the expenditure counts when original use of the structure begins.

  4. File with IRS Form 5695. The 2025 instructions were revised April 30, 2026. Check with a tax preparer for your situation.

IRS Form 5695 instructions (2025) ↗ · Draft 2026 instructions ↗ · verified October 12, 2026

What’s left: state and utility programs, not federal credits

State credits and rebate finders

Some states run their own. Colorado’s heat pump tax credit is claimed by registered contractors, who show it as a discount on your invoice: for installs from January 1, 2026, the air-source heat pump credit is $1,000, with at least $333 discounted to the customer. Colorado Energy Office ↗ Denver guide →

ENERGY STAR’s Rebate Finder searches offers on certified products by ZIP code. Rebate Finder ↗

Common questions

Can I still claim the Energy Efficient Home Improvement Credit (25C) in 2026?

No. Public Law 119-21 ended 25C for property placed in service after December 31, 2025. Improvements placed in service in 2025 are claimed on your 2025 return with IRS Form 5695.

Is there still a tax credit for a home energy audit?

Not for audits paid for or done after December 31, 2025. A 2025 audit of your main home can be claimed on the 2025 return, up to $150, if a qualified home energy auditor certified through a DOE-recognized program did it (or supervised it) and gave you a signed written report with the auditor’s name and EIN or TIN, an attestation of certification and the certification program’s name.

I paid for solar panels in 2025, but they were installed in 2026. Do I get the 25D credit?

No. The IRS says an expenditure is made when original installation is completed, so paying in 2025 for a system installed in 2026 does not qualify (IRS FS-2025-05, question 7).

Did the heat pump tax credit end too?

Yes. The separate $2,000 annual cap for heat pumps, heat pump water heaters, biomass stoves and boilers was part of 25C and ended with it. Geothermal heat pumps were covered by 25D, which also ended.

Does the end of 45L affect homebuyers?

Only indirectly. Builders, not homeowners, claimed 45L, up to $5,000 per home, for qualifying homes acquired through June 30, 2026.

What replaced the federal home energy credits?

No new federal credit. The help that remains comes from state-run Home Energy Rebates (taking applications in 10 states plus DC as of October 12, 2026), utility programs and the Weatherization Assistance Program for income-qualified households.

Not sure where to start?

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Sources

Checked October 12, 2026.

Full program tracker Home Energy Rebates Rebates by state