What the 2024 energy tax credit covers
The Inflation Reduction Act energy tax credit covers specific appliances that meet federal efficiency standards. You claim the credit on your tax return for the year you installed the appliance in your home. The credit applies to new appliances only — not used or refurbished ones — and the appliance must be installed in a home you own or rent (not a second home or investment property).
The appliances that may have access to fall into two categories: those that get a flat credit amount per unit, and those where the credit depends on the appliance's efficiency rating. A heat pump water heater, for example, gets up to $3,750. A heat pump for heating and cooling gets up to $2,000. An electric stove or cooktop gets up to $840. A clothes washer gets up to $540. The exact amount you receive depends on the appliance type and, in some cases, your household income.
Income limits apply to most appliances. If your household income exceeds 150% of your area's median income, you cannot claim the credit for that appliance. The IRS publishes income limits by county each year, so you will need to check your specific location.
Key Takeaways
- The credit covers heat pump water heaters, heat pumps for heating and cooling, electric stoves and cooktops, clothes washers, dishwashers, heat pump clothes dryers, and biomass stoves.
- You must install the appliance in your primary residence during the tax year you claim the credit, and the appliance must be new, not used.
- Income limits apply: your household income cannot exceed 150% of your area's median income, which varies by county.
- You claim the credit on your tax return for the year the appliance was installed, not when you purchased it.
- Some appliances have efficiency requirements; the retailer or manufacturer can tell you whether a specific model meets the standard.
Heat pump water heaters and heating systems
A heat pump water heater qualifies for up to $3,750 if it meets the Department of Energy efficiency standard. The appliance must have an energy factor of at least 2.0 and be installed in your primary home. You do not need to replace an existing water heater — you can install one in a new construction home and still claim the credit.
A heat pump for space heating and cooling (also called a central heat pump or ductless mini-split) qualifies for up to $2,000. The system must meet the federal efficiency rating for your climate zone. The IRS website lists which models may have access to, though most modern heat pumps sold by major manufacturers meet the standard. Installation must be in your primary residence.
If your household income exceeds 150% of your area's median income, you cannot claim either credit. If your income is at or below that threshold, you can claim both credits in the same year if you install both appliances.
Electric cooking appliances and clothes washers
An electric stove, cooktop, or range qualifies for up to $840 if it is new and installed in your primary home. The appliance must be powered entirely by electricity — gas stoves do not may have access to. There is no efficiency rating requirement; any new electric cooking appliance meets the standard.
A clothes washer qualifies for up to $540 if it meets the Department of Energy's Modified Energy Factor standard. Most new washers sold at major retailers meet this standard, but you can ask the retailer or check the yellow EnergyGuide label on the appliance. The credit applies whether the washer is top-load or front-load.
A dishwasher qualifies for up to $600 if it meets the federal efficiency standard. Like clothes washers, most new dishwashers meet the requirement. The same income limits apply: your household income cannot exceed 150% of your area's median income.
Heat pump clothes dryers and biomass stoves
A heat pump clothes dryer qualifies for up to $2,000 if it meets the Department of Energy efficiency standard. Heat pump dryers use less energy than traditional electric dryers and are increasingly common at major appliance retailers. The model must be new and installed in your primary home.
A biomass stove (a wood-burning or pellet stove) qualifies for up to $2,000 if it meets the EPA efficiency standard for that stove type. The stove must be new and installed in your primary home. Biomass stoves are less common than other may have access to appliances, so you may need to contact a specialty retailer or the manufacturer to confirm the model meets the standard.
How to claim the credit on your tax return
You claim the energy tax credit using Form 5695 (Residential Energy Credits), which you file with your annual tax return. You will need the date the appliance was installed, the cost, and documentation that it meets the federal efficiency standard. Keep your receipt and any paperwork from the retailer or installer.
The credit is non-refundable, meaning it reduces the tax you owe but does not result in a refund if the credit exceeds your tax liability. If you owe $1,500 in federal income tax and claim a $2,000 credit, your tax liability becomes zero, but you do not receive the extra $500. You can carry unused credit forward to the next tax year in some cases — check the IRS instructions for Form 5695.
If you are unsure whether your specific appliance model meets the standard, contact the retailer, the manufacturer, or a tax professional. The IRS does not pre-approve individual models, so the burden is on you to verify before you claim the credit.
Income limits by county and how to verify yours
The income limit for most appliances is 150% of your area's median family income. This varies significantly by county — a household income that qualifies in one county may exceed the limit in another. The IRS publishes a county-by-county table on its website each year.
To find your limit, locate your county on the IRS table and compare your household income to the threshold. Household income includes wages, self-employment income, rental income, and other sources. If you are married filing jointly, combine both spouses' incomes. If you are unsure whether you are over the limit, a tax professional can help you calculate it.
If your income exceeds the limit, you cannot claim the credit for that appliance, even if you installed it in your primary home and it meets all other requirements. There is no partial credit or exception process.
Frequently Asked Questions
Can I claim the credit if I rent my home?
No. The credit applies only to appliances installed in a home you own. If you rent, you cannot claim the credit even if your landlord installs a may have access to appliance. The homeowner would be the one may be able to access to claim it.
Do I have to install the appliance myself, or can a contractor do it?
A contractor can install the appliance. You do not have to do the installation yourself. The credit applies based on when the appliance was installed in your home, not who performed the installation.
What if I buy an appliance in 2024 but install it in 2025?
You claim the credit in the year the appliance was installed, not the year you purchased it. If you buy it in 2024 and install it in 2025, you claim the credit on your 2025 tax return. Keep your receipt to document the purchase date and the installation date.
Can I claim the credit for a second home or rental property?
No. The credit applies only to your primary residence — the home where you live most of the year. Second homes, vacation homes, and investment properties do not may have access to.
What if the appliance I want does not meet the efficiency standard?
You cannot claim the credit. Only appliances that meet the Department of Energy or EPA standard may have access to. Ask the retailer or manufacturer whether a specific model meets the requirement before you purchase it.