The federal government offers tax incentives in the form of tax credits for homeowners to install geothermal systems in their homes. These systems use the natural heat from the ground to heat and cool your home, which is not only beneficial for the environment but can also save you a significant amount of money on your energy bills. If you are considering upgrading to a geothermal system, you may be wondering about the tax credit available in 2023. Here’s what you need to know:
The tax credit for geothermal systems in 2023 is 30 percent
This increase is due to the Inflation Reduction Act (IRA) of 2022
The new tax credit is effective January 1st, 2023
The 30 percent tax credit is available until 2032
After 2032, the tax credit begins to slowly decrease until it expires in 2034
So, if you are planning on installing a geothermal system in your home, a tax credit of 30 percent of the total cost is available to you for the next several years. Not only will this significantly lower your upfront costs, but you will also enjoy lower energy bills and a more environmentally-friendly home. Consider taking advantage of this tax credit while it is still available.