Questions About IRA Benefits? Rewiring America Has The Answers

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Rewiring America now has an online tool that lists all the incentives and tax credits available to Americans in the new Inflation Reduction Act. The new law, popularly known as the IRA, has an amazing number of provisions that can help people decarbonize their lives and save money doing it. The problem is, there are so many of them and so many terms and conditions that have to be met to qualify for the benefits, most people are confused. Unfortunately, confused people often throw up their hands and decide to do nothing.

Don’t despair. Rewiring America says it wants to “make adoption of this electric future as quick and seamless as possible, so we’ve built a calculator to help make households aware of how much money they’ll get through the incentives available to them in this bill. It’s an easy-to-use tool that provides an instant snapshot of what a household can do. Now.” To date, more than 200,000 people have used the online tool to calculate their own benefits.

Sam Calisch, head of special projects at Rewiring America, tells Canary Media, “I’m so excited that we put this out because it does seem like it’s being legitimately useful to people trying to figure out what the [law] means for them.” He says more than 40% of US energy emissions stem directly or indirectly ​“from the decisions households make at their kitchen tables” — things like ​“where they get their electricity from, what they use to heat and cool their homes, and what they drive.”

Rewiring America Online Tool

Even though the online tool is designed to be simple and straightforward, some people at Canary Media still had difficulty using it, so the media group came up with some hints and suggestions. First, the calculator asks for several pieces of information — your ZIP code, homeowner status, household gross income, household size, and whether you file taxes as an individual, jointly, or head of household.

It uses different pieces of that information to determine your eligibility for different incentives. For example, your household income will qualify you for some incentives if it’s less than a certain absolute amount, and for others if it’s below a certain percentage threshold of the median income in your area. The calculator looks that up based on your ZIP code and household size using data from the US Department of Housing and Urban Development.

Your homeowner status comes into play because some incentives require you to be a homeowner or only make financial sense for property owners. Renters probably don’t want to foot the bill for an updated electric panel or geothermal heating system, for instance, so the calculator dismisses incentives for these types of items. Keep in mind that the final regulations for all these benefits have yet to be created by the federal government, but the online tool is still a great place to start.

Canary Media did a test calculation for a hypothetical married couple with two children. They want to install a rooftop solar system, buy an electric car, and replace appliances powered by fossil fuels with models that run on electricity. They live in the ZIP code 55412, which is in Minneapolis. Here are some likely scenarios for this couple.

Rewiring America
Image courtesy of Rewiring America

Lower Income Homeowner

Assuming a household income of $63,900, the family is considered a low-income household, as are other four-person households in their ZIP code earning up to $89,400, or 80% of the area median income. The couple owns their home. The online tool says the family qualifies for all of the incentives the calculator assesses.

The Rewiring America calculator shows that if the family takes advantage of these incentives, which are available for the next 10 years, they could save $14,000 through upfront discounts and another $4,149 via credits toward their tax bill. The calculator also shows the family would save $1,150 a year in utility and heating bills. Over 10 years, the family could save a total of $29,649.

Moderate Income Homeowner

Giving the hypothetical family an income of $167,500 would put them in moderate income range. They would still qualify for every incentive except the used electric vehicle tax credit, which is capped at a household income of $150,000 for those who file a joint tax return. Also, the family would only qualify for half of the discount for installing a heat pump heating and cooling system — $4,000 instead of $8,000.

Calisch calls the upfront discounts ​“game-changing” for low and moderate income households because they will help them access the long term benefits of electrification — healthier indoor air quality and lower, more stable bills. That stability ​“is really critical for these households with high energy burdens” that suffer from spikes in oil and gas prices, such as those caused by Russia’s invasion of Ukraine. Electricity prices have ​“much, much lower volatility, which is hugely helpful for these households.”

Higher Income Homeowner

Households earning more than 150% of area median income don’t qualify for as many incentives. If the hypothetical family earns $200,000, they no longer qualify for any upfront discounts, but can still take advantage of the clean energy and efficiency tax credits as well as the home energy reduction rebate program, which rewards homeowners for retrofits that substantially reduce their energy consumption. And of course they will still realize important energy savings if they upgrade their home.


“Renters get the short end of the stick,” said Calisch, who is a renter himself. ​“But there are some really interesting provisions that help us.” If that hypothetical family of four qualifies as low income and rents instead of owns, they can still qualify for the tax credits on new and used electric vehicles. In addition, if they invest in a heat pump, electric stove or heat pump electric dryer for their own personal use, those items also qualify for upfront discounts.

High income renters who earn above 150% of the area median income may still qualify for the new EV tax credit provided their income does not exceed $300,000 for married couples filing jointly.

The Takeaway

Now that we have simplified things for you, it’s time to complicate them again. A separate federal home energy efficiency program that used to be called the Zero Emissions Homes Act has been updated and folded into the IRA. It is now known as the High Efficiency Electric Home Rebate Act, or HEEHRA for short.

HEEHRA is beyond the scope of this article, but we will have a breakdown of that program for our readers’ amusement and edification coming shortly. Stay tuned!

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Steve Hanley

Steve writes about the interface between technology and sustainability from his home in Florida or anywhere else The Force may lead him. He is proud to be "woke" and doesn't really give a damn why the glass broke. He believes passionately in what Socrates said 3000 years ago: "The secret to change is to focus all of your energy not on fighting the old but on building the new." You can follow him on Substack and LinkedIn but not on Fakebook or any social media platforms controlled by narcissistic yahoos.

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