With rising energy costs and growing awareness about sustainability, homeowners are looking for ways to save money while making their homes more energy-efficient. One opportunity you might not know about is the Energy Efficient Home Improvement Credit, a federal incentive that can help offset the cost of upgrades like insulation, air sealing, and more. At Koala Insulation of Chicago Western Suburbs, we want to make sure our customers know how to take advantage of this valuable tax credit.
What Is the Energy Efficient Home Improvement Credit?
The Energy Efficient Home Improvement Credit is part of the Inflation Reduction Act, designed to encourage homeowners to invest in energy-saving home improvements. It offers a tax credit of up to 30% of the cost of eligible upgrades, helping reduce the overall expense of making your home more efficient. This credit applies to improvements made to your primary residence, including insulation, air sealing, and other qualifying measures.
How Does It Work?
When you make qualifying energy-efficient upgrades, you can claim a percentage of the project cost on your federal taxes for that year. For insulation projects, this could mean significant savings on materials and labor. At Koala Insulation of Chicago Western Suburbs, we help customers choose upgrades that not only improve home comfort but also qualify for these incentives. The credit applies to the year the improvements are completed, so timing your project can maximize your tax benefit.
Which Home Improvements Qualify?
Several home upgrades can qualify for the Energy Efficient Home Improvement Credit, including:
- Insulation: Spray foam, blown-in, and batt insulation projects can all be eligible.
- Air Sealing: Sealing leaks around windows, doors, attics, and crawl spaces to improve energy efficiency.
- Energy-Efficient Windows and Doors: Replacing old, drafty models with ENERGY STAR®-rated options.
- HVAC Upgrades: Installing high-efficiency heating, cooling, and ventilation systems.
- Solar Attic Fans: Using solar-powered ventilation to reduce heat buildup and improve comfort.
Koala Insulation of Chicago Western Suburbs specializes in insulation and air sealing—two of the most cost-effective and impactful upgrades that can qualify for the credit.
How Much Can You Save?
For insulation and air sealing, the Energy Efficient Home Improvement Credit can cover 30% of the total cost, up to an annual maximum of $1,200 for certain improvements. That means if you invest $4,000 in a qualifying insulation project, you could receive a $1,200 tax credit, lowering your actual cost to $2,800. Not only will you save on your taxes, but you’ll also enjoy lower energy bills year-round.
Why Insulation Is a Smart Way to Use the Credit
Insulation is one of the best investments for improving home energy efficiency. In the Chicago area, where winters are cold and summers can be hot and humid, proper insulation helps maintain consistent indoor temperatures and reduces strain on your HVAC system. With the Energy Efficient Home Improvement Credit, upgrading your insulation now can be more affordable than ever. Koala Insulation of Chicago Western Suburbs can help you choose the right insulation type for your home, whether that’s spray foam for maximum air sealing, blown-in for cost-effective coverage, or batt insulation for specific areas.
How to Claim the Credit
To claim the Energy Efficient Home Improvement Credit:
- Complete Your Upgrade: Work with a qualified installer like Koala Insulation of Chicago Western Suburbs to ensure your project meets eligibility requirements.
- Save Your Documentation: Keep receipts, contracts, and manufacturer certifications for your records.
- File IRS Form 5695: Include this form with your federal tax return to claim the credit.
- Work with a Tax Professional: They can help ensure you’re claiming the correct amount and meeting all requirements.
Common Questions About the Credit
Do I need to upgrade my entire home’s insulation to qualify?
No. Even partial upgrades—like adding insulation to your attic or sealing air leaks—can qualify, as long as they meet the program’s requirements.
Can I claim the credit more than once?
Yes. The credit resets annually, so you can plan multiple projects over several years and claim the credit each time, up to the annual limit.
Does this apply to rental properties?
Generally, the credit applies only to improvements on your primary residence, not rental or vacation homes.
Combining the Credit with Other Incentives
One of the best parts about the Energy Efficient Home Improvement Credit is that it can often be combined with state, local, or utility rebates. In Illinois, homeowners may qualify for additional incentives that further reduce the cost of insulation and air sealing. Koala Insulation of Chicago Western Suburbs can help you explore all available programs to maximize your savings.
Why Work with Koala Insulation of Chicago Western Suburbs?
We don’t just install insulation—we take the time to make sure your project is done right and that you’re aware of any potential rebates or credits. Our process includes:
- Energy Efficiency Assessment: We evaluate your home to identify the areas where insulation will make the biggest difference.
- Customized Solutions: We recommend the right insulation type and R-value for your home and the Chicago climate.
- Expert Installation: Our trained professionals use industry best practices for maximum performance.
- Guidance on Incentives: We help you understand what qualifies for the Energy Efficient Home Improvement Credit and how to document your project.
Don’t Miss Out on These Savings
The Energy Efficient Home Improvement Credit is a limited-time opportunity to save money while making your home more comfortable and efficient. If you’ve been putting off insulation upgrades, now is the perfect time to act. With Koala Insulation of Chicago Western Suburbs, you can enjoy expert installation, lasting comfort, and a lower energy bill—all while benefiting from valuable tax savings.
Conclusion
The Energy Efficient Home Improvement Credit makes it easier than ever to invest in energy-saving upgrades like insulation and air sealing. Not only can you reduce your taxes, but you’ll also enjoy year-round comfort and lower utility bills. At Koala Insulation of Chicago Western Suburbs, we’re here to help you make the most of this program and get the results you deserve. Call us today at (630) 574-9033 or visit our website for a free estimate.
