A Quiet Change Just Shortened the Timeline for a Valuable Home Energy Tax Credit

Homeowners across the U.S. were told they had nearly a decade to take advantage of a generous energy efficiency tax credit.

But that window is closing much faster than expected.

The Energy Efficient Home Improvement Credit, expanded under the Inflation Reduction Act, was initially available through 2032. But thanks to recent federal legislation – the One Big Beautiful Bill Act – that deadline has been moved up.

The credit will now expire on December 31, 2025.

If you’ve been thinking about insulating or air sealing your home, the clock is now ticking.

What is This Tax Credit, and What Changed?

This credit, also known as Section 25C, was designed to make home energy upgrades more affordable.

Here’s what it offers.

• Thirty percent back on qualifying insulation and air sealing materials in the tax credit
• A yearly cap of $1,200
• Available for existing primary residences only
• Labor costs are excluded, but materials like injection foam insulation, weatherstripping, caulk, and spray foam are included.

Originally, homeowners had nearly a decade to take advantage of this. Now, unless Congress brings it back in the future, 2025 is the final year to qualify.

Why This Matters to Homeowners Everywhere

Insulation and air sealing are two of the most effective ways to reduce energy loss and monthly bills in any climate.

Whether you’re dealing with cold winters, hot summers, or both, a well-sealed home is more comfortable and more efficient.

The cost of insulating your home with foam can vary depending on the size of the area to be insulated. With the tax credit, homeowners can save up to $1,200 on materials – a meaningful offset.

But only if the work is done before the deadline.

What You Should Do Before the Credit Expires

You don’t have to rush, but now is the time to start planning.

Here’s how to stay ahead:

• Schedule an estimate early to avoid last-minute installer backups
• Ask about insulation that also provides air sealing to qualify for the full credit
• Complete the work by December 31, 2025
• Keep documentation for your tax professional when filing

Plan Now, Save While You Still Can

If an insulation upgrade was on your list, this is your window.

By starting and finishing your project by the end of 2025, you’ll lock in savings, increase comfort, and beat the federal cutoff.

To find a RetroFoam dealer in your neck of the woods, check out the Dealer Finder on our website.

Key Points:

• The Energy Efficient Home Improvement Credit will now end in 2025, not 2032.
• The credit offers 30 percent back on qualifying insulation and air sealing materials, up to $1,200 per year.
• Homeowners still have time to claim the credit, but planning ahead is key.

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