Inflation Reduction Act (IRA) Energy Tax Credit Estimator

US energy tax credits 25C and 25D: calculation and expiry

The US federal credits 25D (solar, batteries, geothermal) and 25C (heat pumps, home improvements) no longer apply to property placed in service after December 31, 2025, so since January 1, 2026 the tool counts them at $0. From 2023 to 2025 they were worth 30% of the cost, uncapped for 25D and up to $3,200 a year for 25C.

What the tool calculates

• 25D: (solar + battery + geothermal) × 0% since January 1, 2026 (30% with no cap from 2023 to 2025).
• 25C, heat pumps: (heat pump + heat pump water heater) × 0% since January 1, 2026 (30%, capped at $2,000, from 2023 to 2025).
• 25C, other improvements: insulation, windows, doors and electrical panel × 0% since January 1, 2026; the former caps ($1,200, $600, $500 and $600, sum limited to $1,200) stay in the calculation but have no effect at a zero rate.
• Net cost = total cost − credits; payback = net cost ÷ (monthly savings × 12).

Worked example (default values)

Solar $18,000, battery $9,000, heat pump $8,500, water heater $2,400, insulation $3,000, windows $4,000, doors $1,200 and panel $2,000: $48,100 of work. 25D and 25C credits: $0, net cost $48,100, paid back in 48,100 ÷ (220 × 12) ≈ 18.2 years with $220 saved per month. Under the 2023-2025 rules the credit would have reached $11,300 and the payback 13.9 years.

Limits

• Since Public Law 119-21 of July 4, 2025 (One Big Beautiful Bill Act), the IRS states that the 25D credit is not available for property placed in service after 12/31/2025 and that 25C only covers improvements made through 12/31/2025. The tool therefore applies zero rates and no longer calculates 2025 expenses.
• The $250-per-door limit, the home energy audit (up to $150) and eligibility conditions (battery of at least 3 kWh, qualifying equipment, panel installed alongside qualifying property) are not modelled, nor is your actual tax liability.
• Indicative estimate only; it does not replace advice from a tax professional.

Sources and dates: IRS, Residential Clean Energy Credit (25D), page updated 07/04/2026; IRS, Energy Efficient Home Improvement Credit (25C), page updated 04/28/2026; the tool counts both credits at zero for property placed in service since 01/01/2026 (checked 10/15/2026).

Frequently Asked Questions

Is the 30% solar tax credit still available in 2026?

Not for a new installation: according to the IRS, the 25D credit is not available for property placed in service after December 31, 2025, following Public Law 119-21 of July 4, 2025. The tool therefore counts this credit at $0; it was worth 30% of the cost for a 2025 or earlier installation.

What was the 25C cap for a heat pump?

For 2023 to 2025 the credit was 30% of the cost, capped at $2,000 a year for heat pumps, heat pump water heaters and biomass stoves or boilers. With $1,200 for other improvements, the annual total reached $3,200.

Why do $4,000 of windows only give a $600 credit?

Windows and skylights were capped at $600 in total per year, even though 30% of $4,000 is $1,200. Exterior doors were limited to $250 per door and $500 in total. Since January 1, 2026, the tool counts these credits at $0.

Did a standalone battery qualify?

Yes, from 2023 a battery of at least 3 kWh qualified for the 30% 25D credit even without solar panels. The tool does not check this minimum capacity.

Is this tool really free?

Yes, all tools on Kristools are 100% free and accessible without registration.

Is my data protected?

Yes. All processing is performed directly and securely inside your browser. No personal data is sent to our servers.