Oregon homeowners are facing a critical deadline to maximize savings on energy-efficient home improvements by stacking federal tax credits with local cash offers. The federal tax credits established under the Inflation Reduction Act (IRA) are set to expire at the end of 2025, making the remaining months of this year the final opportunity to complete eligible projects.
Homeowners can claim these federal tax credits when filing their taxes in early 2026 for any qualifying projects completed in 2025. Many of these upgrades also qualify for cash incentives from Energy Trust of Oregon, a nonprofit that helps people, businesses and communities use less energy and save money. Combining tax credits and incentives allows homeowners to get the deepest possible savings.
Along with lowering energy bills, these changes help make your home more comfortable inside. Energy efficiency improvements eligible for both the federal tax credits and Energy Trust incentives include:
Insulation: Adding or updating insulation on your attic, walls and floors can keep your heated or cooled air inside, meaning your system doesn’t have to work as hard.
Windows: Replacing older windows with energy efficient ones can keep your home more comfortable by keeping the air in and preventing drafts.
Heating and cooling: Heating and cooling your home is likely one of your biggest home energy expenses, so upgrading to modern, energy efficient units like heat pumps are a great way to keep energy costs low.
Water heating: Switching from a traditional water heater to a more efficient heat pump water heater uses much less energy to heat your water (often the second largest energy expense after heating and cooling).
Home energy audit: Credits can cover the cost of a professional energy “check-up” for your home. During the audit, an energy auditor uses tools to monitor temperature and moisture in your home and advises on the best upgrades to make, where your home is using energy efficiently and where energy may be wasted.
The Energy Efficient Home Improvement federal tax credit offers two separate caps for tax credits, allowing homeowners to claim a total of up to $3,200 on their 2026 taxes from projects finished before December 31, 2025. The general cap with a maximum of $1,200, covers upgrades like insulation, windows, doors and home energy audits. Additionally, there’s a separate cap of $2,000 for installing an electric heat pump or heat pump water heater.
To claim the federal tax credits when filing a 2025 tax return, homeowners must have receipts and the manufacturer’s certification statements for all upgraded products. The process involves filling out a Form 5695 through the IRS website or tax prep software and filling in the details of energy-efficient improvements made at home in 2025 that qualify. Afterward, consult a tax professional to ensure everything is correct and ensure you’re able to qualify for as many savings as you’re eligible to claim.
Energy Trust does not give tax advice. Consult your tax professional for current information on credits available and how to apply.
About Energy Trust of Oregon
Energy Trust of Oregon is an independent nonprofit created to help people, organizations, and communities save energy and connect to renewable power like solar. Funded by customers ofPortland General Electric,Pacific Power,NW Natural,Cascade Natural GasandAvista, Energy Trust services lower energy costs and help communities and utilities achieve their clean energy goals and build a strong future for Oregon. Learn more atwww.energytrust.org/residential/incentives.
