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Dane County Office of Energy & Climate Change

Inflation Reduction Act Resources for Individuals

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Types of Federal Rebates and Incentives Available
for Clean Energy Projects


Tax Credits for Individuals

Home Efficiency

Homeowners can receive tax credits through the IRA to improve home energy efficiency. In general these opportunities apply to a taxpayer's primary residence. In some cases second homes are eligible but these are not available for rental properties occupied by tenants.

Energy efficiency tax credits are available on an annual basis, up to $1,200 each year, which means you can take advantage of this credit annually. We encourage you to plan out upgrades so you can take full advantage of the credit over multiple years.

Learn more about all of the efficiency tax credits and refer to the summary table below for more detailed information. Also see IRS FAQs about energy efficient home improvements and residential clean property credits.

Home Energy Audits

Home energy audits are a great place to begin making home efficiency improvements. After a home inspection, the audit will reveal the areas for the greatest energy efficiency improvements and therefore the areas for the greatest potential energy savings. Then you can make a plan for how to prioritize making those upgrades over a number of years.

Up to $150 in tax credits are available for home energy audits. Learn more about home energy audits from Focus on Energy.

These credits are only available to principal residences of homeowners and are not open to second homes or tenants.

Note that beginning in January 2024 energy assessment will need to list their federal EIN number and credentials on their energy report if you want to receive the $150 tax credit.

Insulation and Efficiency

Insulation materials (see more details for what qualifies), windows (including skylights), and exterior doors are all eligible for tax credits. Learn more in the table below and learn more about the required product specifications to be eligible for tax credits.

Insulation, exterior doors, and windows may not include labor costs.

Efficient Heating/Cooling Appliances

Additional appliances that qualify for tax credits include energy efficient boilers, central air conditioners, furnaces, biomass stoves, water heaters, and other appliances. See details to verify specific product requirements.


This credit only applies to your principal residence.


The IRA tax credits will help homeowners transition to all-electric appliances.

  • For heating and cooling:
    • Air-source heat pumps (30% credit, up to $2,000 – annual limit of $1,200 may be exceeded). Learn more about what a heat pump isqualifying heat pumps, and read the Focus on Energy Heat Pump Buying Guide.
    • Geothermal heat pumps (30% credit with no upper limit because this is considered renewable technology)
  • For water heating:
    • Heat pump water heaters (30% credit, up to $2,000 – annual limit may be exceeded)
    • Solar hot water heaters (30% credit, no limit because this is considered a renewable technology)
  • Electric panel or circuit upgrades for new electric equipment (30% credit, up to $600)
  • Efficient air conditioners and heating equipment (30%, up to $600)


Labor expenses are eligible expenses for heat pumps, heat pump water heaters, electric panel upgrades, and more.

Homeowners (primary or secondary houses) and tenants are eligible for to receive these credits.

Read more about the equipment specifications required to be eligible for tax credits.

Solar Energy

Tax credits of up to 30% of eligible expenses for residential solar installation are available, with no dollar cap or income qualifiers.

For reference:

A typical residential rooftop installation in Wisconsin is 7 kW and might cost about $24,000 (costs will vary based on size, complexity of installation and other factors). The tax credit for a $24,000 installation is $7,200, which would reduce the installation cost to $16,800.

Learn more about installing solar energy on your residence.

What Costs Qualify?

These credits are available to all costs associated with solar installation as well as any battery storage. However, note that "the cost of roof installation is generally not eligible, except for incremental costs, or the amount over what you would have spent if the root was not used for solar. These costs could include solar shingle, solar tiles, or the incremental cost of installing a reflective roof membrane that increases electricity generation."


Existing homes and new construction qualify. Both principal residences and second homes qualify. Rentals do not qualify. The home served by this system does not have to be the taxpayer's principal residence.

A principal residence is the home where you live most of the time. The home must be in the United States. It can include a house, houseboat, mobile home, cooperative apartment, condominium, and a manufactured home.

Additional Credits and Rebates

Wisconsin households may qualify for additional incentives for a solar installation. Many households, for example, qualify for the Focus on Energy rebates. (Focus on Energy eligibility for solar incentives is based on whether or not your electric utility participates in Focus.)

Entities might also get discounts or incentives from manufacturers or installers. 

The IRS guidance for residential clean energy credits states "you may need to subtract subsidies, rebates or other financial incentives from your qualified property expenses because they're considered a purchase-price adjustment."  See that guidance for more details. 


Other Renewables

In addition to solar energy, the 30% tax credit applies to:

  • Wind generation
  • Geothermal systems
  • Solar water heaters
  • Fuel cells
  • Battery storage

Because these are all renewable energy projects there is no maximum tax credit, and this credit can roll over to future years.

Electric Vehicles

Purchasing New Electric Vehicles

The U.S. Treasury recently provided updated guidance on purchasing new and used electric vehicles.

  • Total tax credit available is up to $7,500
  • Credit is only available for qualified vehicles. List of eligible vehicles. Check and note vehicle eligibility upon vehicle purchase as this list will be continually updated and eligibility is dependent upon purchase date.
  • Retail prices (MSRP) cannot exceed
    • Pickups, SUVS, and vans must cost < $80,000
    • Cars must cost < $55,000
      • Some car models have exceptions to this limit and have an $80,000 MSRP cap.
  • Household income requirements for the tax credits
    • Joint tax return < $300,000
    • Head of household < $225,000
    • Single-payer < $150,000

2023 guidance on EV credit for purchased vehicles

Instant Rebates

Beginning in 2024, point of sale rebates are now available at select dealerships, meaning that the purchaser can receive the equivalent tax credit off the purchase price rather than waiting to file their annual tax return.

Instant rebates are both simpler for the purchaser while also conveying two major advantages. First, the purchaser does not need to have a tax liability at least equivalent to the tax credit amount of $7,500, but also the instant rebate is deducted from the sale price, which lowers the sales tax of the purchase as well.

Purchasing Used Electric Vehicles

  • $4,000 tax credit or 30% of vehicle’s sale price
  • Stipulations:
    • Vehicle’s model must be at least two years older than the current “new” model year,
    • Total vehicle cost must be less than $25,000
    • Buyer must purchase vehicle from a dealer
    • Credit available only once per vehicle (so the purchaser or the dealer need to verify that previous owner didn't claim this credit)
  • Income requirements:
    • Joint tax return < $150,000
    • Head of household < $112,300
    • Single-payer < $75,000

Instant Rebates

Used electric vehicles are now eligible for instant rebates, meaning the tax credits are available as a point of sale reduction in purchase price at select dealerships.

Instant rebates are both simpler for the purchaser while also conveying two major advantages. First, the purchaser does not need to have a tax liability at least equivalent to the tax credit amount, but also the instant rebate is deducted from the sale price, which lowers the sales tax of the purchase as well.

Leasing New Electric Vehicles

When you lease a vehicle the company leasing you the vehicle can access a different, commercial vehicle EV tax credit. Typically companies pass the tax credit savings onto you as the person paying for the lease. The IRS guidance indicates that leased EVs do not fall under the same Buy American requirements as purchased EVs. That means that some vehicles that are not eligible for a tax credit if you purchase the vehicle will be eligible for a tax credit at lease. In IRS terms, it’s the difference between a Section 30D credit and a Section 45W credit.

Electric Vehicle Chargers

Some individuals can receive a 30% tax credit, up to $1,000, for the installation of a home electric vehicle charger.

To qualify, the equipment must be placed in a low-income community or a non-urban area. Low-income communities include population census tracts where the poverty rate is at least 20% or is a metropolitan or non-metropolitan area census tract where the median family income is less than 80% of the state medium family income level.

Some electric utilties also offer incentives for the installation of EV charging infrastructure. Search for electric utility incentives at Drive Electric Wisconsin.

How Do Inflation Reduction Act Tax Credits Stack with Focus on Energy Rebates?

This table comes from Focus on Energy. Refer to the their blog post for the original table.

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Calculate Your Tax Credits

Use this calculator from Rewiring America to find out the savings available to you through the President Biden Affordable Clean Energy Plan. Note that this calculator does not include additional local oportunities for rebates, such as Focus on Energy rebates and incentives.


More Ways to Save

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Income-Based Rebates

Beginning in 2024, additional rebates will be available to residents who are at or below 150% of Area Median Income (AMI), with additional savings available to those who make significantly below AMI.

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Focus on Energy Incentives

Focus on Energy has an ongoing rebate program for home efficiency and renewable energy projects, some of which is income-based and some of which is not.These will be available for most Wisconsin residents (eligibility based on electric utility). Learn more about what is available at the Focus on Energy website.


What's a Tax Credit?

A tax credit is a dollar-for-dollar reduction in the amount of income tax you would otherwise owe. You claim this annually as part of your annual tax return. By contrast, a rebate is an upfront discount that gives you cash back after you make a purchase, and typically happens more quickly than a tax credit.

How To Receive a Tax Credit

To apply you for tax credits you should save applicable receipts and submit for tax credits as part of your annual tax return. See IRS guidance for more detail on what forms to submit with your tax return.

Always check with your contractor or retailer before purchasing systems to ensure eligibility.