In 2023, taxpayers claimed more than 8 billion dollars’ worth of clean and energy-efficient tax credits. With a multitude of credits available, it was easier for the everyday person to invest in a new, clean vehicle or home improvement. Now, with the passing of the One Big Beautiful Bill Act (OBBBA), many of these credits have been terminated. Despite this, there is a small period between now and the end of the year when they can still be claimed. So what credits are still available, and when do you have to act to qualify for them?

Clean Vehicle Credit

Labor Day is traditionally one of the busiest car-buying weekends of the year, with all the sales and inventory in dealership lots. With the passage of the OBBBA, the Clean Vehicle Credit is terminated and may not be claimed for vehicles acquired after September 30, 2025. If a taxpayer wants to take advantage of this credit, they need to purchase it before then.

For vehicles placed in service after April 18, 2023, there is a $7,500 credit if the vehicle meets the following requirements.

• $3,750 if the vehicle passes a domestic test for critical minerals in the battery.
• $3,750 if the vehicle passes a domestic test for essential battery components.

In addition to those requirements to qualify for the credit at all, a vehicle must:

• Be acquired for resale
• Be made by a qualified manufacturer
• Meet the definition of a motor vehicle under Title II of the Clean Air Act (any vehicle manufactured primarily for use on public streets, roads, and highways. It must also have at least four wheels.)
• Have a battery capacity of at least 7 kilowatt hours and must be capable of being recharged from an external source of electricity.
• Weigh 14,000 pounds or less
• Undergo final assembly in North America
• Have a suggested retail price of $80,000 for trucks, vans, and SUVs, and $55,000 for any other vehicle

To find a list of eligible vehicles, visit https://fueleconomy.gov/feg/tax2023.shtml.

It’s also important to keep track of your income. If you go over the following thresholds in 2023 and 2024, you can no longer claim the credit.

• $300,000 for married filing jointly
• $225,000 for heads of household
• $150,000 for all other filers

Previously Owned Clean Vehicle Credit

For people looking to get a used car, the Previously Owned Clean Vehicle Credit is also terminated for vehicles acquired after September 30, 2025. While the dates remain the same for new and used vehicles, the credit amounts and requirements differ. The used vehicle must be bought from a dealership for 25,000 dollars or less. The credit amount is 30% of the purchase price to a maximum of $4,000 if the vehicle meets the following requirements.

• Have a battery capacity of 7 kilowatt hours
• Weigh 14,000 pounds or less
• Be placed in service after 2022
• Be used primarily in the United States

Your income also matters for this credit. If you are above the following thresholds in both 2023 and 2024, you will not qualify.

• $150,000 for married filing jointly
• $112,500 for heads of household
• $75,000 for all other filers

Make sure the dealership gives you and the IRS a copy of the time-of-sale report for both the new and used vehicles. This can be used as proof that you purchased the car within the remaining period of the credit’s availability.

Residential Clean Energy Credit

The residential clean energy credit is for taxpayers who have just installed new green energy sources in their home. If you are looking to get these improvements and still want to qualify, make sure to have the installation process started by the end of the year. As of July 4, the credit is terminated for any costs incurred after December 31, 2025. The credit covers 30% of the installation costs, including any labor involved. The items that qualify are:

• Solar Panels
• Solar Water Heaters
• Wind Turbines
• Geothermal Heat Pumps
• Fuel Cells
• Battery Storage Technology

The residence where the items are installed must be your main residence and cannot be used solely for business purposes.

Energy Efficient Home Improvement Credit

An energy-efficient home improvement is an installation designed to reduce wasted power. An example would be energy-efficient windows, designed to keep a home warmer in the winter and cooler in the summer. For any taxpayer considering installing these, you should start work before the end of the year. Similarly to the previous credit, as of July 4, the credit is terminated for any costs incurred after December 31, 2025.

The credit is for 30% of the installation costs, up to a maximum of $1,200 for the following property expenditures:

• $250 per exterior door to an annual maximum of $500
• $600 for exterior windows and skylights
• $150 for home energy audits

Then there is a separate $2,000 annual limit for:

• qualified biomass stoves/boilers
• heat pumps
• water heaters.

Add that all together, and if you incur enough costs before December 31, 2025, you could save up to $3,200 on your 2025 tax return.

To qualify, you must be in the United States, and the additions must be to a preexisting home, not a new home. Similar to the Residential Clean Energy Credit, the home cannot be used solely for business purposes.

Conclusion

With the passing of the One Big Beautiful Bill Act, several clean energy credits that many Americans utilized have been terminated. Luckily, there is currently a brief window of time when the credits will still apply for anyone looking to take advantage of them. If you’ve been on the fence about investing in a clean energy vehicle or home improvement, now could be the time to act. Consider consulting your tax advisor to learn more or better understand if you qualify and if this is the right decision.

Written with contributions from Michael Hamberger, 2025 Summer Intern.