Disclosure: 1-800Deals is a contractor directory. We don't run any rebate program, and listings never change the facts on this page.
Short answer: No, not for new work. The Energy Efficient Home Improvement Credit (IRS section 25C) doesn't apply to any property placed in service after December 31, 2025. If your heat pump, windows, insulation or other upgrade was installed in 2025, you can still claim up to $3,200 on your 2025 return with Form 5695. For work done in 2026, the money now comes from state HOMES and HEAR rebates and utility rebates, not federal tax credits.
See what applies at your address. Enter your ZIP and the finder shows your state's rebate status and your local utility rebate lookups.
Find rebates by ZIP codeWhat happened to the 25C credit
The One Big Beautiful Bill Act, signed July 4, 2025, moved the end date up. The IRS states it plainly: the 25C credit "will not be allowed for any property placed in service after December 31, 2025." "Placed in service" means installed and ready to use, not paid for or ordered. A deposit in December for a heat pump that went in during January doesn't count. Source: IRS OBBB FAQ.
The credit was never a rebate. It reduced the tax you owed, it couldn't create a refund on its own, and unused amounts couldn't be carried forward. That matters if you're comparing it with the rebates that are left, which come off the price or come back as a check.
What 25C paid for 2025 installs
If you finished a project in 2025, these are the limits that apply on your 2025 return, per the IRS credit page:
| Item (installed in 2025) | Credit | Cap |
|---|---|---|
| Heat pumps, heat pump water heaters, biomass stoves and boilers | 30% | $2,000 a year (separate bucket) |
| Central AC, gas/propane/oil water heaters, furnaces, boilers | 30% | $600 per item |
| Electrical panel (200 amps or more) needed for qualifying equipment | 30% | $600 |
| Exterior windows and skylights (ENERGY STAR Most Efficient) | 30% | $600 total |
| Exterior doors (ENERGY STAR) | 30% | $250 per door, $500 total |
| Insulation and air sealing materials | 30% | Within the $1,200 limit |
| Home energy audit by a certified auditor | 30% | $150 |
| Most per year | $1,200 + $2,000 = $3,200 |
Labor counts for heat pumps and other equipment but not for windows, doors or insulation. For 2025 installs, each item except insulation and air sealing also needs the manufacturer's Qualified Manufacturer Identification Number (QMID) on your return. Ask your installer for it if it isn't on the invoice.
How to claim a 2025 project
- Gather the itemized invoice showing the install date, model numbers and what you paid for equipment versus labor.
- Get the product's certification: ENERGY STAR Most Efficient for windows, the CEE top tier for heat pumps (your installer or the ENERGY STAR tax credit pages can confirm).
- Subtract utility subsidies and manufacturer or installer rebates. The IRS treats those as a lower purchase price. Most state energy rebates don't have to be subtracted, but check the IRS rules for your case.
- File Form 5695 with your 2025 return. Missed it? You can amend with Form 1040-X, generally within three years.
What replaces it in 2026
Three kinds of money are still on the table, and they stack differently:
| Program | Who runs it | Typical form | Income limits |
|---|---|---|---|
| HEAR (electrification rebates) | Your state energy office | Up-front discount through a registered contractor or store | Yes, under 150% of area median income |
| HOMES (whole-home efficiency rebates) | Your state energy office | Rebate based on modeled or measured savings | No, but bigger rebates for lower incomes |
| Utility and local rebates | Your electric or gas company, city or county | Mail-in or instant rebate | Usually not |
Our state-by-state guide to HOMES and HEAR rebates shows which states are taking applications. The fastest check is the home energy rebate finder: enter your ZIP and it shows your state's program status and the utility rebate lookups for your area.
Upgrade by upgrade, where to look now
- Heat pumps: HEAR can cover up to $8,000 for income-eligible homes. See heat pump rebates after the tax credit ended.
- Windows and doors: HEAR doesn't cover them, so the options are thinner. See what's left for window and door upgrades.
- Insulation: Utility programs are strongest here. See our attic insulation rebate guide.
- Solar and batteries: That was a different credit (25D), and it ended too. See what happened to the solar tax credit.
Rebates almost always need a contractor who's registered with the program and an itemized quote. You can start with local heating and cooling contractors or electricians in our directory, then ask each one whether they're enrolled before you sign.
Frequently asked questions
Can I still claim the energy efficient home improvement credit in 2026?
Only for property installed by Dec 31, 2025, claimed on your 2025 return. Anything placed in service in 2026 or later doesn't qualify. Paying a deposit in 2025 doesn't help if the installation was finished in 2026.
Are there income limits for energy credits?
The 25C credit never had income limits, but it only helped if you owed federal tax. The rebates that remain are different. HEAR is limited to households under 150% of area median income, and HOMES pays more to households under 80%.
What qualifies for the energy-efficient home improvement credit?
For 2025 installs: qualifying heat pumps, heat pump water heaters, central AC, efficient furnaces and boilers, water heaters, electrical panels, ENERGY STAR doors, Most Efficient windows and skylights, insulation and air sealing, and certified home energy audits.
Is it worth claiming new windows on taxes?
Only if they went in during 2025 and met ENERGY STAR Most Efficient. The credit was 30% of the window cost, excluding labor, capped at $600 for all windows and skylights. For 2026 installs there's no federal credit.
How does the new $6,000 tax deduction work?
That's the new enhanced deduction for people 65 and older, not an energy credit. It has nothing to do with home improvements. The IRS explains who qualifies on its One Big Beautiful Bill provisions page.
Do I have to subtract rebates from the credit?
Usually yes for utility subsidies and rebates from the seller, installer or manufacturer. The IRS treats them as a lower price. State energy efficiency incentives generally aren't subtracted unless they count as a purchase-price adjustment.
Sources
- IRS: Energy Efficient Home Improvement Credit
- IRS: OBBB energy credit FAQs
- IRS: About Form 5695
- IRS: One Big Beautiful Bill provisions
- U.S. DOE: Home Energy Rebates
- ENERGY STAR: Federal tax credits
Amounts and statuses were checked Oct 13, 2026. Programs change often, so confirm with the program before you sign a contract. Where we couldn't verify a figure, we say so instead of guessing.
