Go Green and Save: Eco-Friendly Home Upgrades That Pay Off
Every year on Earth Day, we’re reminded of the impact our choices have on the environment. One of the most effective ways to live more sustainably is through energy-efficient home improvements. But many homeowners hesitate, concerned about upfront costs.
The good news? There are federal tax credits and state rebates available to homeowners in Illinois, Minnesota and Wisconsin designed to make eco-friendly upgrades more affordable. Whether you’re considering solar panels, energy-efficient windows or geothermal heating, these programs can help you save money while making your rural home more sustainable.
Federal Incentives for Energy-Efficient Upgrades
If you're thinking about making your home more energy-efficient, the federal government offers tax credits to offset installation costs.
Energy Efficient Home Improvement Credit
As part of the Energy Efficient Home Improvement Credit, homeowners can receive a 30% tax credit on qualifying energy-efficient home improvements, with a maximum of $1,200 per year for most upgrades. This includes:
- Exterior doors
- Exterior windows & skylights
- Insulation & air sealing materials
- Home energy audits
Additionally, heat pumps, biomass stoves and boilers may qualify for a separate $2,000 annual credit.
To be eligible, improvements must meet specific energy efficiency standards set by the Department of Energy. The credit is available through 2032 and applies to primary residences only.
Residential Clean Energy Credit
With the Residential Clean Energy Credit, homeowners can receive a 30% tax credit on the cost of installing qualifying clean energy systems. This includes:
• Solar panels
• Solar water heaters
• Geothermal heat pumps
• Small wind energy systems
• Battery storage technology
There is no annual cap on this credit, and it applies to both primary and secondary residences (excluding rental properties). The credit is available through 2032, with a gradual phase-out starting in 2033.
State Rebates
Besides federal tax credits, many states offer additional rebates to encourage energy-efficient upgrades.
Illinois:
- Illinois Solar for All: Provides incentives for solar panel installations to help homeowners transition to renewable energy.
Minnesota:
- Home Efficiency Rebate Program: Offers up to $8,000 for whole-home energy efficiency improvements.
- Home Electrification & Appliance Rebate: Encourages homeowners to replace traditional appliances with high-efficiency, all-electric alternatives.
Wisconsin:
- Focus on Energy: A statewide program offering rebates for insulation, heating and cooling upgrades and energy-efficient appliances.
Why Energy-Efficient Upgrades Are a Smart Investment
Beyond immediate savings, energy-efficient home improvements come with long-term benefits:
- Lower Energy Bills – High-efficiency windows, insulation and smart appliances cut heating and cooling costs.
- Higher Home Value – Homes with eco-friendly upgrades appeal to buyers and can boost resale value.
- Environmental Impact – Using less energy reduces carbon emissions, contributing to a cleaner, healthier planet.
- Comfort & Performance – Upgrading your home means better insulation, more efficient heating and cooling and improved air quality.
Explore Financing Options with Compeer Home
Earth Day is the perfect time to explore energy-efficient home improvements that benefit both your wallet and the environment. With federal tax credits and state rebates, making sustainable upgrades is more affordable than ever.
For those looking to finance a home in a rural community, Compeer Home is here to help. Our team of expert lending officers are committed to supporting homeowners with financing solutions that fit their needs. Ready to find a loan that fits? Try our loan finder tool today!
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