A tax credit is a dollar-for-dollar reduction in the amount of taxes owed. Tax credits are often used to encourage taxpayers to engage in certain behaviors, such as saving for retirement or investing in energy-efficient home improvements. The tax credit 2025 is a specific tax credit that is available to taxpayers who make qualified energy-efficient home improvements.
The tax credit 2025 was created by the American Recovery and Reinvestment Act of 2009. The credit is available for qualified energy-efficient home improvements that are installed between January 1, 2009, and December 31, 2022. The maximum amount of the credit is $500. To claim the credit, taxpayers must file Form 5695, Residential Energy Credits, with their tax return.