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The Inflation Reduction Act (IRA) was passed in 2022, providing around $370 billion in support for climate and energy plans. Learn about some of the IRA's important components and how Eaton can benefit your clean energy investment initiatives. Read more...
The commercial Investment Tax Credit (ITC), which provides tax credits for qualified sustainable energy improvement projects such as solar systems, has been extended until 2024, and qualifying project eligibility has been enhanced. The ITC eligibility has recently been increased to include:
The ITC will contain a 6% base credit, up to 30% if certain prevailing wage and apprenticeship conditions are met. Domestic content, qualifying environmental justice projects, and those located in energy areas may all be eligible for further credit increases.
In 2025, a general zero-emissions Clean Electricity Credit will take effect, allowing new zero-emissions facilities to pick ITC. Credit availability will phase out as the US power sector emits 75% less carbon than in 2022, or by 2032.
The Energy Efficient Commercial Building Tax Credit would provide a deduction for qualified building construction and retrofit projects that aim to lower overall energy and power expenses by at least 25%. This tax credit makes it more affordable to upgrade your building's infrastructure.
The Energy Efficient Home Improvement Tax Credit allows homeowners to deduct up to 30% of the cost of energy-efficiency renovations from their taxes. Heat pumps, insulation, windows, and water heaters are some of the changes that can be made. It may also include modifications to or replacement of electrical equipment such as panelboards, sub-panelboards, branch circuits, or feeders. The credit may not exceed $1,200 in total for any taxpayer during any taxable year.
The Department of Energy's High-Efficiency Electric Home Rebate Program will offer reimbursements to low- or moderate-income households for qualified electrification projects, such as electrical infrastructure upgrades. Upgrades to electric load service centers can qualify for up to $4,000 in rebates, while electric wiring projects can qualify for up to $2,500. Grants will be provided to states to start the program, with details varying by state. Rebates cannot be coupled with Federal subsidies or rebates through the "HOMES" program.
The Alternative Fuel Refueling Property Tax Credit provides an up to 30% credit for electric car charging and refueling stations until 2032. To be eligible for the full 30%, taxpayers must meet qualifying property and labor conditions.