This new version of the credit allows you to claim 30% of the total cost of new windows and skylights installed during the year, up to a maximum limit of $600. Starting in the 2023 tax year, this credit was renamed to become the Energy Efficient Home Improvement Credit and the credit was extended to the end of the 2032 tax year. Thus, if you had replaced your windows in 2007 and claimed the $200 credit at that time, you would not be able to claim any credit for other windows you may have installed in later years. However, a lifetime credit limit of $200 for windows applied for all tax years after 2005. Up until the end of 2022, this tax credit was known as the Nonbusiness Energy Property Credit, and it allowed you to claim 10% of the cost of exterior windows (and skylights) up to a maximum limit of $200.

This kind of tax credit has been available since 2006, but a recent tax law change has expanded the benefit significantly for windows installed from 2023 onwards. However, rather than this benefit being a deduction from your income, it instead takes the form of a reduction in the tax you would otherwise pay (a tax credit, in other words).

Yes, you can indeed receive a tax benefit for installing new energy efficient windows on your house – provided that certain conditions are met.

IRA download the new for windows