The Trump administration’s One Big Beautiful Bill Act will make pulling back on U.S. emissions a whole lot harder for a range of reasons. The budget plan has dealt major blows to all manner of clean-energy programs while also buoying the fossil fuel industry.
Renewables are arguably the hardest hit, but everyday folks should also brace for some extra expenses. Household energy costs could jump by up to $280 a year by 2035. The bill has also shortened the timeline folks have to cash in on tax incentives created by the Inflation Reduction Act—President’s Biden signature climate bill. These offerings help individuals invest in technologies that will draw down their own personal emissions.
If you’ve been considering anything from an electric vehicle to trading your furnace for a heat pump, credits that were originally set to last close to a decade are now winding down as soon as September. Here’s the rundown on available tax credits—and when you need to start making moves.
Expiring on Sep. 30: Credits on EVs
Anyone looking to take a big bite out of their emissions has to consider trading their gas-powered car for an EV. About 37% of U.S. emissions come from transportation—and 21% of those come from individual drivers’ cars. Tax credits can give you an assist in making the switch. Eligible vehicles can earn a credit of up to $7,500, and used rides can get up to to $4,000. There are, of course, stipulations around the specific car you buy (for instance, the credit is limited to vehicles that meet requirements about where they’re built) and how much you make.
Expiring on Dec. 31: Credits on heat pumps, water heaters, and more
The Energy Efficient Home Improvement Credit applies to nearly a dozen different items that could improve the overall efficiency of a home. These include swaps like replacing old windows and doors, whole-home projects like improving insulation and air sealing, or HVAC upgrades like installing a heat pump. Depending on what you do, there’s up to $2,000 in available credit for anything installed before the end of the year.
Expiring on Dec. 31: Credits on rooftop solar
One of the biggest swipes in the budget bill rolls back the Residential Clean Energy Credit, which homeowners can tap to cover up to 30% of solar panels or installations of other renewable systems like wind turbines. Given that the average price of a solar install can reach as high as $40,000, the payoff could be huge.