With the August 16, 2022, signing of the Inflation Reduction Act (IRA), high-efficiency biomass heating products once again qualify for a tax credit under Section 25(C) of the Internal Revenue Code (“IRC” or “tax code”). This new 30 percent tax credit – capped at $2,000 annually – is available for appliances installed between January 1, 2023, and December 31, 2032. The credit can be used on the purchase and installation costs of qualifying appliances. To be eligible for the tax credit, an appliance must have a thermal efficiency of at least 75 percent per the higher heating value (HHV) of the fuel.
Beginning in 2023, consumers buying highly efficient wood or pellet stoves or larger residential biomass heating systems may be eligible to claim a 30% tax credit – capped at $2,000 annually – based on the full cost (purchase and installation) of the unit. The credit runs through December 31, 2032. The 10-year term and 30 percent credit have been big components of HPBA’s advocacy push of the Biomass Thermal Utilization (BTU) Act over many years.
Feel free to contact Ryan Carroll (Carroll@hpba.org) with any questions that are not answered by our website.
What is this new tax credit?
What happens to the 25(C) tax credit?
See our new FAQs about this new tax credit for additional information.
The Sec. 25(C) biomass stove tax credit expired after December 31, 2020. The credit must be claimed in the year in which product installation was completed.
With this credit having expired, 2020 is the last year the biomass stove tax credit of $300 can be claimed on a tax return. Download the consumer one-pager here
Efficiency Maine Low-Interest Loans Program
For more information, go to Efficiency Maine
ME - Efficiency Maine Residential Home Energy Savings Program
Eligibility: Residents of Maine
For more information, click here: Website
CLOSED - Massachusetts Clean Energy Center (MassCEC) Changeout
1. $400 instant discount
2. Residential Flood Recovery Rebate
For more information on WOODSTOVES: Efficiency Vermont For information on central heaters: Efficiency Vermont
CLOSED - New York State Pellet Stove Incentive Program
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