Beneficial Tax Credits for New Homes and Upgrades

Proper insulation is essential in creating an efficient and comfortable home. The good news is that through the Inflation Reduction Act, there are tax credits for both new homes and upgrades to existing homes, and those tax credits can benefit everyone including contractors.

New home builders can take advantage of the 45L tax credits, while the 25C tax credits are for homeowners to claim – but because homeowners need someone to do the work of installing additional insulation, 25C is a win for contractors too by creating new jobs. Whether it’s 45L or 25C, Johns Manville has the details for you. 




B7700 Climate Pro Blow-In

45L: HOMEBUILDER Tax Credits

The Inflation Reduction Act includes much-needed improvements and extensions to federal tax credits for home energy efficiency.

There are credits for new home construction. It’s simple for a builder to take advantage of these energy tax credits, and with the help of Johns Manville insulation products, you can make the most of this opportunity.

Surprisingly, the differences in insulation material costs for the $2,500 tax credit vs. the $5,000 credit for new builds are minimal, even none in some climate zones.


Three Bedroom 2,200 SF Home, 2x6 framed

Check out the following charts for insulation material costs across climate zones and for different sections of a typical 3-bedroom home.
HIGHLIGHTED CELLS state the difference from ENERGY STAR v3.1 to Certified DOE Zero Energy Ready.

Three Bedroom 2,200 SF 2X6 Advanced Frame Home

25CHOMEOWNER Tax Credits and Contractor Benefits

Sure, 25C tax credits benefit homeowners – but did you know they also have big benefits for you, the contractor? With the 25C Energy Efficient Home Improvement Credit, homeowners can get tax credits for adding insulation to improve their home’s energy efficiency. But to do so, they’re going to need a contractor to install the new insulation. Which is exactly how the tax credits benefit you, the contractor, too – more jobs! To meet new energy codes, older homes need additional insulation. That can be a win-win for the homeowner because they’ll see reduced energy bills, while also being eligible for the tax credits.

Under 25C, homeowners get credits for up to 30% of the cost of insulation materials installed, for a max of $1,200 each year. There’s no lifetime dollar limit, meaning homeowners can continue to call you year after year to install more energy efficiency upgrades in different parts of their home.

The R-value of insulation required to meet the 25C credit requirements varies depending on the climate zone in which a home is located. No matter the insulation type or location, Johns Manville can help you. With a large selection of products that can be used for retrofitting a home, we’ve got the solution you need.

For more information on how to claim the tax credit,
visit for updates to Form 5695.


Watch On-Demand!
Insulation Intel® Webinar:
IRA 25C Tax Credits: What’s in it for the contractor?

New tax credits are a big incentive for homeowners to install additional insulation. So what’s in it for you, as an installer or contractor? More jobs (and more income)! Johns Manville has all the details in this webinar.