Kane County Government
How Do I

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Important Note: The 25C Federal Tax Credit expires at the end of 2025.

Introduced under the Energy Policy Act of 2005 and overhauled under the Inflation Reduction Act of 2022, the Energy Efficient Home Improvement Credit (aka the 25C tax credit) offers tax incentives to Americans who make energy-saving measures in their homes or apartments.

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Kane County residents can claim up to $3200 in tax incentives given they install qualifying products from both categories:

  • 30% off or up to $2000 for a heat pump, water heater, biomass stove, or biomass boilers.
  • 30% off or up to $1200 for eligible weatherization upgrades:
    • Exterior Doors ($250 per door, $500 limit)
    • Exterior Windows and Skylights ($600 limit)
    • Insulation and Air Sealing materials ($1200 limit)

 
How Much does an Energy-Efficient Upgrade Cost?

 
How to Claim the 25C Tax Credit:

1. Hire a contractor or personally install an energy-efficient upgrade to your primary residence.

2. Make sure the materials used to weatherize your primary residence meet certain standards:

A. Exterior Doors: Must meet Energy Star standards;

B. Exterior Windows and Skylights: Must meet Energy Star Most Efficient certification requirements;

C. Insulation: R60 (uninsulated attic), R49 (already have 3-4 inches of attic insulation), R30 (floors) & must meet 2023 IECC standards;

D. Air Sealing: must come with a Manufacturer Certification Statement & meet 2023 IECC standards;

D. Heat Pump: Must meet the Energy Star Most Efficient standard;

E. Biomass Stoves/Boilers: Must have a thermal efficiency rating at or above 75%.​

3. ​Fill-out and file IRS Form 5695 for the 2025 tax season. 

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Credit: Dennis Schroeder, NREL 24441