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IRA money available for climate-friendly home upgrades

Between the Regional Greenhouse Gas Initiative (RGGI), and the Inflation Reduction Act (IRA), there are several avenues of obtaining financial help with paying for home upgrades such as solar and weatherization. These kinds of home upgrades as well as switching to low or no gas cars, or using public transportation are all great ways to reduce how much fossil fuels we consume, and reduce our greenhouse gas emissions. We thought we’d gather up some information for Loudouners on various funding available, but please keep in mind that we are a climate group, not tax or financial advisors. Check with your tax and financial advisors rather than making any purchase or financial decisions based on this information.

Related to the IRA specifically, there’s a really informative FACT Sheet available on the IRS website where we sourced a lot of this information: https://www.irs.gov/pub/taxpros/fs-2022-40.pdf, as well as this page on the Virginia Dept of Energy website: https://www.energy.virginia.gov/energy-efficiency/Inflation-Reduction-Act.shtml

Rewiring America has a handy calculator application here: https://www.rewiringamerica.org/app/ira-calculator

One important thing to note with the IRA funding options is that they are not refundable meaning they can only be used to reduce your tax liability.

Weatherization from CHP
Handling weatherization and funding by RGGI, Community Housing Partners is a great option for weatherization in Loudoun for those that qualify. See the website for the table of income requirements based on household size.

More info here: https://www.communityhousingpartners.org/energy-solutions/weatherization/

ENERGY STAR and WaterSense Sales Tax Holiday
The three-day sales tax holiday begins the first Friday in August and ends the following Sunday each year. During this period, consumers may purchase certain Energy Star qualified products exempt of the Retail Sales and Use Tax. The exempt items include: any dishwasher, clothes washer, air conditioner, ceiling fan, compact fluorescent light bulb, dehumidifier, programmable thermostat, or refrigerator, the energy efficiency of which has been designated by the United States Environmental Protection Agency and the United States Department of Energy as meeting or exceeding each such agency’s requirements under the Energy Star program and costing up to $2500.

More info here: https://www.deq.virginia.gov/get-involved/pollution-prevention/virginia-information-source-for-energy/programs-and-financial-incentives

30% Uncapped Tax Credit for Solar Panels and Battery Storage
Funded by the IRA, this is an extension of the previous tax credit that was set to decline from 26% to 22% before expiring in 2024 but has been extended until 2032 and hiked to 30%. Starting this year, the credit will extend to battery storage installation, but only if it’s upgraded in conjunction with the installation of rooftop solar (otherwise there’s a cap).

30% Uncapped Tax Credit for Geothermal Heating
Funded by the IRA, those of us that can take advantage of geothermal heating can get a 30% tax credit to install it.

30% Tax Credit for Heat Pumps, Doors, and Windows, up to $3200.
This gets a little confusing, but the IRA provides funding for up to $2000 total per year for heat pumps, as well as up to $1200 per year total for “building envelope components, home energy audits, and energy property”, so windows, doors, insulation, energy audits, and electrical panels. These can be used each year as well in case one was able to space out their purchases.

$7500 Tax Credit for new EV cars
Another IRA one. This applies to both 100% electric cars and plug-in hybrids as well.

More on qualifying vehicles here: https://www.irs.gov/credits-deductions/credits-for-new-clean-vehicles-purchased-in-2023-or-after

Up to $4,000 credit for used EV purchases
There’s some standards to meet and the best source of info on that we could find is here: https://www.irs.gov/credits-deductions/used-clean-vehicle-credit Thankfully used EV’s have been getting cheaper. Some now sell for under $10k.