IRA Energy Efficient Home Improvement Tax Credit (25C)

IRS / Inflation Reduction Act

Closed Energy Assistance

About This Program

Note: Congress ended this federal tax credit for installations after December 31, 2025. Projects placed in service by that date can still be claimed on your 2025 federal return (IRS Form 5695).

The Inflation Reduction Act's 25C tax credit covers 30% of costs for qualifying energy-efficient home improvements, up to $3,200 annually. The credit includes up to $2,000 for heat pumps and heat pump water heaters, and up to $1,200 for insulation, windows, doors, and electrical panel upgrades. The credit is nonrefundable and resets each tax year.

30% credit, annual max $3,200 ($2,000 for heat pumps; $1,200 for other items).

Verified against IRS / Inflation Reduction Act's official page on 2026-06-17.

Data last verified 2026-04-03. How we verify our data.

In Birmingham, AL, you can combine this program with other local help to cut your cost:

Key Details

  • 30% of qualifying project costs, up to $3,200 per year
  • Heat pumps / heat pump water heaters: up to $2,000
  • Insulation, windows, doors, electrical panel: up to $1,200 combined
  • Resets each tax year for installations completed by December 31, 2025
  • No income limit; must have federal tax liability to use credit

How to Apply

Get free help applying Visit Official Program Page Track this program

800-829-1040

A grant-savvy contractor in Birmingham, AL can handle the paperwork, inspections, and timelines so your funding releases on schedule. Getting matched is free.

You will likely need a contractor to apply

Projects like this almost always need a licensed contractor, and many grants ask for a written estimate as part of your application. Lining up a contractor in Birmingham early keeps your application moving.

Get matched with a contractor

Each program sets its own contractor rules. Check the official program page for exact requirements.

Your application paperwork

Documents you will likely need

  • Your federal tax return for the year of the work (this benefit is claimed on your taxes, not through a separate application).
  • Proof you own and live in the home (deed, recent mortgage statement, or property tax bill).
  • A government-issued photo ID for every owner on title.
  • A written estimate from a licensed contractor for the work (many programs require this to apply).
  • A recent utility bill for the home (energy and weatherization programs use it to confirm service and usage).
  • The program's own application form, completed (use the official link or phone number on this page).
Download this checklist (PDF)

Requirements vary by program and locality. Confirm the exact rules on the official program page. We can help you prepare your paperwork, but you submit it yourself.

Deadline: Ended December 31, 2025 (federal law change)

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