WEBVTT - Using Energy Tax Credits To Your Advantage #656 0:00:00.080 --> 0:00:03.240 Welcome to How to Money. I'm Joel and I am Matt. 0:00:03.360 --> 0:00:28.240 Today we're talking about using energy tax credits to your advantage. Yeah, buddy. 0:00:28.320 --> 0:00:30.800 So we don't categorize our episodes this way, but if 0:00:30.840 --> 0:00:33.040 we did, this would definitely fall into the camp of 0:00:33.200 --> 0:00:36.839 episodes that are going to help save you money. You know, 0:00:36.880 --> 0:00:39.680 I don't think many folks get too excited about spending 0:00:39.680 --> 0:00:42.000 money on their home when they don't get to see 0:00:42.000 --> 0:00:44.360 the results of that money that they spend, Right, Like, 0:00:44.400 --> 0:00:47.320 I don't think folks mind spending on paint, like having 0:00:47.320 --> 0:00:49.640 your house painted. My parents actually they're in the middle 0:00:49.680 --> 0:00:53.320 of getting quotes for painting the interior of their home. 0:00:53.360 --> 0:00:56.200 It's not cheap, which they haven't done in like thirty years. 0:00:56.360 --> 0:00:58.640 It's gonna make a big difference, it is. I was 0:00:58.680 --> 0:01:01.000 shocked at the some of the numbers that Dad was 0:01:01.000 --> 0:01:02.920 telling me. But even still, I think that's something that 0:01:02.920 --> 0:01:06.200 folks can get behind. Or even like buying furniture or 0:01:06.240 --> 0:01:08.560 something like that, right, but they kind of up or 0:01:08.560 --> 0:01:12.200 a new rug which really ties the room together. That's right. 0:01:12.480 --> 0:01:15.280 But what we are going to be discussing today are 0:01:15.280 --> 0:01:17.280 the things, the upgrades that you can make that are 0:01:17.319 --> 0:01:19.760 a little nerdier that that said that funny that are 0:01:19.800 --> 0:01:22.760 a little nerdier because they're going to save you money. 0:01:23.040 --> 0:01:25.480 That's what we're talking about today. Yeah, so we're talking 0:01:25.480 --> 0:01:27.679 about specifically things you can do to your house that 0:01:27.920 --> 0:01:30.600 most of them are unseen or and they're really all 0:01:30.600 --> 0:01:33.839 about kind of energy efficiency. And so there are new 0:01:34.040 --> 0:01:37.360 kind of rules in place, new some new incentive, new intended, 0:01:37.480 --> 0:01:41.160 new perks for you to quiet these moves. Nerdy there 0:01:41.160 --> 0:01:43.559 we go. Yeah, it's good that time. Well, we normally 0:01:43.560 --> 0:01:45.640 when you like, we put these things off because we 0:01:45.680 --> 0:01:48.240 know that they might save us money. But we're like, 0:01:48.520 --> 0:01:50.280 it's just not as fun as like a new kitchen 0:01:50.280 --> 0:01:52.320 faucet or something like that, or new countertops or whatever 0:01:52.360 --> 0:01:54.560 it is there you go or ship lap like joint 0:01:54.600 --> 0:01:57.760 against like kitchen fawcett. That's that's you're reaching out of 0:01:57.760 --> 0:02:01.280 your own experience there, because you can make something you've got. 0:02:01.360 --> 0:02:03.320 You've had that pass, I need to actually put it in. 0:02:04.280 --> 0:02:07.000 It looks very nice, I bought it. It'll look awesome 0:02:07.080 --> 0:02:09.880 having get installed it. So your plumbing situation is out 0:02:09.880 --> 0:02:12.359 of control. Though you're the same, it's hard to get too. Yeah, yeah, 0:02:12.360 --> 0:02:13.880 I mean we both got up under there, and you're like, 0:02:13.880 --> 0:02:15.440 what do you think. I was just like, dude, I 0:02:15.480 --> 0:02:17.560 have no idea how any human being would be able 0:02:17.600 --> 0:02:19.320 to You need like a house elf to get up 0:02:19.360 --> 0:02:21.480 in there to take care of that and see if 0:02:21.480 --> 0:02:23.800 Dobby's available, so do that for him. But yeah, so 0:02:23.840 --> 0:02:25.280 we're gonna talk to all about that today. But I 0:02:25.560 --> 0:02:27.320 want to quickly mentioned before you get to that, Matt, 0:02:27.400 --> 0:02:30.760 that just there was this like a really sad situation 0:02:30.919 --> 0:02:34.440 in one of my kiddo's classes where one of her 0:02:35.320 --> 0:02:38.560 classmates parents passed, I know exactly, and they had just 0:02:38.639 --> 0:02:40.200 had what you're talking about, baby daughter. It was like 0:02:40.200 --> 0:02:42.680 the saddest thing in the world to me. And so 0:02:42.760 --> 0:02:47.280 the class was taking donations and everybody was so generous 0:02:47.520 --> 0:02:49.480 and just giving money to this family and really like 0:02:49.560 --> 0:02:51.600 supporting them in a bunch of other ways too. It's 0:02:51.680 --> 0:02:54.240 nice to live in a community where people take care 0:02:54.280 --> 0:02:56.000 of each other, right, And I feel like we live 0:02:56.000 --> 0:02:58.080 in a place where that is true. And it just 0:02:58.120 --> 0:03:00.640 made me think too that one of the person of 0:03:00.720 --> 0:03:03.519 spending lesson you make of being diligent about savings is 0:03:03.560 --> 0:03:06.320 that you can be like hyper generous in situations. Absolutely 0:03:06.360 --> 0:03:10.799 man so, and I've seen that be the case. Our 0:03:10.800 --> 0:03:12.440 family has been able to do that, but a lot 0:03:12.480 --> 0:03:15.080 of families around us too. Yeah, so yeah, it just 0:03:15.160 --> 0:03:17.520 kind of wanted to put that out there. Make sure 0:03:17.560 --> 0:03:21.720 that you're using your means to, especially when it comes 0:03:21.720 --> 0:03:24.200 to supporting communities, not just like, hey, let me donate 0:03:24.200 --> 0:03:26.919 some money to the Red Cross, which is fine and dandy, 0:03:26.919 --> 0:03:28.800 and I have no problem with you, but make sure 0:03:28.840 --> 0:03:30.480 you set some aside too for just stuff like that, 0:03:30.520 --> 0:03:32.359 because it breaks my heart. Absolutely. Yeah. I mean we 0:03:32.440 --> 0:03:34.280 touched we actually touched on this a little bit last week. 0:03:34.320 --> 0:03:37.280 But that is a great reason to be good with 0:03:37.280 --> 0:03:40.600 your money, to prepare in advance for these different opportunities 0:03:40.800 --> 0:03:43.000 that come up. But that's cool, man. Yeah, I'm glad 0:03:43.000 --> 0:03:45.320 that y'all are able to give. We our kids go 0:03:45.360 --> 0:03:47.560 to different schools, but even still, I had heard about 0:03:47.560 --> 0:03:49.960 that that heartbreaking store. My heart definitely goes out to 0:03:49.960 --> 0:03:51.960 that family. Maybe we'll reach out as well for sure. 0:03:52.040 --> 0:03:54.840 Yeah so all right, Sorry started to start a downer, 0:03:54.960 --> 0:03:58.119 but yeah, let's good job, buddy. Let's move on. Let's 0:03:58.120 --> 0:04:00.240 get to the topic in hand. We're talking about using 0:04:00.280 --> 0:04:03.240 these new energy tax credits to here, and we still 0:04:03.240 --> 0:04:04.520 got to introduce the beer. Oh, we have a beer. 0:04:04.560 --> 0:04:06.800 That's right, So maybe I kind of forgot about it 0:04:06.840 --> 0:04:08.160 because it is a beer that we're having for the 0:04:08.160 --> 0:04:09.840 second time of the show, the first time we've ever 0:04:09.880 --> 0:04:11.960 repeated a beer. Yeah, we had nothing in the first 0:04:12.000 --> 0:04:13.920 Now you're drawing all the attention to it. I was like, 0:04:13.920 --> 0:04:15.920 do we kind of just skate by and just thought 0:04:15.960 --> 0:04:18.359 we forgot to stock the beer fridge. So we've been 0:04:18.440 --> 0:04:20.800 we've been kind of busy lately. Party found and uh 0:04:20.880 --> 0:04:24.000 yeah next week next episode that we have a beer 0:04:24.000 --> 0:04:25.919 oun So I guess next Monday we will most definitely 0:04:26.000 --> 0:04:28.680 have something pressure a new an updated beer. Well, this 0:04:28.720 --> 0:04:31.800 one is pilsner. It's called b Boats by Creature Comforts. 0:04:31.960 --> 0:04:33.680 We'll give our thoughts on it at the end of 0:04:33.680 --> 0:04:36.440 the episode. Yes, even though we've had it before. But yeah, 0:04:36.480 --> 0:04:38.400 let's get to the let's do that topic. And even 0:04:38.400 --> 0:04:40.560 though it is a Pilsner, it is a craft pilsoner. 0:04:40.560 --> 0:04:42.640 I don't want people thinking that we, you know, there's 0:04:42.640 --> 0:04:44.800 a good one that we're like grabbing just like a basic, 0:04:44.960 --> 0:04:47.840 mass produced macrologger pilsner off the show. If you taste 0:04:47.839 --> 0:04:50.039 test or something, if you take test this next to 0:04:50.040 --> 0:04:52.320 one of the macros. It's a very big difference. So good, 0:04:52.400 --> 0:04:54.479 very big gray beer. Yeah. So all right, but let's 0:04:54.480 --> 0:04:56.800 talk about tax credits and how to make sure you're 0:04:56.800 --> 0:04:58.479 getting the most bang for your buck, make sure you're 0:04:58.720 --> 0:05:01.440 you know what cysts, and then how to use them. 0:05:01.560 --> 0:05:03.400 And it made me think, Matt, there was this article 0:05:03.680 --> 0:05:06.800 in the Free Press about folks that make money by 0:05:06.839 --> 0:05:10.640 trying new medications to test their efficacy. And like, they're 0:05:10.800 --> 0:05:13.760 they're getting injections, they're taking pills, and in some of 0:05:13.760 --> 0:05:16.479 the studies they can't even leave the building, but they're 0:05:16.520 --> 0:05:20.160 subject to under house arrest. Basically, basically they're subject to 0:05:20.200 --> 0:05:22.520 large amounts of blood being drawn and this can happen 0:05:22.560 --> 0:05:25.280 for weeks on end. And like, the question is why 0:05:25.320 --> 0:05:28.680 would someone subject themselves to this? And the answer is 0:05:28.720 --> 0:05:31.960 to make money, right, And the most fundamental reality of 0:05:32.040 --> 0:05:36.200 economics is that incentives drive everything. Incentives matter. And I'm 0:05:36.240 --> 0:05:38.760 not planning on going back to let's say, like my 0:05:38.880 --> 0:05:41.800 pressure washing side hustle from twenty years ago, not a 0:05:41.800 --> 0:05:43.800 bad job, not my favorite job of all time. Though, 0:05:44.160 --> 0:05:47.440 unless let's say it were to become massively lucrative. Let's 0:05:47.480 --> 0:05:49.719 say they were like we're going to start paying pressure 0:05:49.720 --> 0:05:52.320 washers like four hundred K year, I'd be like, boom, 0:05:52.400 --> 0:05:55.119 I'm done with podcasting. I'm all in on pressure washers 0:05:55.160 --> 0:05:57.680 of the new influencer, right, And if it was like 0:05:57.720 --> 0:06:00.360 everybody loved the pressure washer was like the cool job 0:06:00.360 --> 0:06:02.480 in town, maybe I'll consider it. I guarantee there are 0:06:02.720 --> 0:06:05.640 TikTok accounts out there dedicated to pressure washing. I'm sure 0:06:05.640 --> 0:06:07.400 there are, and I'm sure they're like fun to watch 0:06:07.440 --> 0:06:09.280 because there's got to be that that was the best 0:06:09.320 --> 0:06:12.760 part about it. After So I say that knowing that 0:06:13.000 --> 0:06:16.800 there Instagram knows you follow these people, knowing him, Well, 0:06:17.000 --> 0:06:18.960 there's this one account in this guy he's got like 0:06:18.960 --> 0:06:21.000 a long care business, and he sets up his phone 0:06:21.000 --> 0:06:23.080 and does it time lapse and he goes and pro 0:06:23.120 --> 0:06:26.280 bono cuts yards that haven't been touched that that are 0:06:26.360 --> 0:06:28.400 kind of like abandoned or the houses are sitting there 0:06:28.400 --> 0:06:31.440 empty and it is so satisfying while he gets in 0:06:31.480 --> 0:06:34.560 there with the edger and cuts along the sidewalk, blows 0:06:34.560 --> 0:06:36.839 it into the yard, hits it with the mower. Oh man, 0:06:36.880 --> 0:06:38.280 I love that kind of stuff. I would be all 0:06:38.279 --> 0:06:42.960 about watching some pressure washing going neighborhoods. One long care time, right, Yeah, 0:06:43.000 --> 0:06:45.840 well yeah, so like not my favorite job, like I said, 0:06:45.880 --> 0:06:47.839 but it was. I will say it was satisfying to 0:06:47.839 --> 0:06:49.839 see the end result. But I'm just like, it's never 0:06:49.880 --> 0:06:52.000 gonna happen. I'm never going back to that because the 0:06:52.040 --> 0:06:54.800 incentive just isn't there sure, And I think like making 0:06:54.800 --> 0:06:57.160 sure that your home is more efficient has never been 0:06:57.200 --> 0:06:59.640 a bad idea, right, but now it's a better one 0:06:59.720 --> 0:07:02.760 thanks to increased federal tax rebates. I think just the 0:07:03.320 --> 0:07:05.320 incentive hasn't been there for a lot of people. Even 0:07:05.320 --> 0:07:06.880 though they know they're going to save a little bit 0:07:06.880 --> 0:07:09.440 of money when it comes to their energy bills, they're 0:07:09.520 --> 0:07:12.440 just like, I don't know, it's not so enticing that 0:07:12.480 --> 0:07:15.440 I'm going to make the leap and actually put insulation 0:07:15.520 --> 0:07:17.720 in my house or something like this, or start installing 0:07:17.720 --> 0:07:20.400 weather shripping. But if you're a homeowner, we would say 0:07:20.440 --> 0:07:22.000 it makes more sense to think a little bit more 0:07:22.040 --> 0:07:24.600 about which upgrades you make and when and how you 0:07:24.640 --> 0:07:27.040 decide to make them. The incentives have changed, and I 0:07:27.040 --> 0:07:28.560 think they're going to be pushing you in the direction 0:07:28.560 --> 0:07:30.560 of doing some of these kind of behind the scenes 0:07:30.680 --> 0:07:33.480 changes to your house to save yourself some money. That's right, Yeah, 0:07:33.520 --> 0:07:35.240 so we're here to do some of that legwork to 0:07:35.320 --> 0:07:37.240 let you know which ones make a little more sense, 0:07:37.240 --> 0:07:39.680 which ones maybe don't. And you know, thinking back to 0:07:39.720 --> 0:07:42.840 that article on human lab rats, a lot of it 0:07:42.880 --> 0:07:45.880 I think kind of depends on their personal situations, right, Like, 0:07:45.920 --> 0:07:47.960 so for some folks it might be just the best 0:07:48.000 --> 0:07:50.600 paying gig that they can find. But then that that article, 0:07:50.640 --> 0:07:52.800 they also have talked about how other folks who were 0:07:52.800 --> 0:07:56.520 involved in those studies, how they actually enjoyed the community 0:07:56.760 --> 0:07:59.320 that forms in some of these longer studies, and that 0:07:59.520 --> 0:08:02.800 the participants they're actually sad when it's over. It's a 0:08:02.840 --> 0:08:06.520 fascinating part of it. Yeah, Yeah. And so similarly, whether 0:08:06.600 --> 0:08:09.480 these energy tax credits make sense, it partly depends on 0:08:09.640 --> 0:08:12.800 you whether going green, whether conserving energy, if if that's 0:08:12.800 --> 0:08:15.800 a high enough priority for you, whether that that cream 0:08:15.880 --> 0:08:17.800 kind of rises to the top, if that makes sense 0:08:17.840 --> 0:08:20.760 for you. But then of course there's the financial side 0:08:20.760 --> 0:08:23.040 of it as well, because you may have heard about 0:08:23.040 --> 0:08:25.880 these energy tax credits. We've even talked about them here 0:08:25.880 --> 0:08:28.600 on the show, and we know that making our homes 0:08:28.640 --> 0:08:30.800 more energy efficient, that that it's going to save us 0:08:30.800 --> 0:08:33.360 money every single month, But how much money could we 0:08:33.480 --> 0:08:36.760 actually save and how much money will we be able 0:08:36.800 --> 0:08:38.880 to get in federal tax credits as well, and so 0:08:38.960 --> 0:08:40.959 crunching the numbers that's going to help us to see 0:08:41.000 --> 0:08:45.280 just how powerful or not perhaps that these incentives are. Yeah, 0:08:45.320 --> 0:08:50.199 by the way, listener Lauren is the one who yet, Yeah. Absolutely. 0:08:50.240 --> 0:08:51.959 She wrote us an email and was like, hey, guys, 0:08:52.000 --> 0:08:53.480 can you do a deep dive on this? And normally 0:08:53.480 --> 0:08:55.680 we would say, hey, toss us a listener question, but 0:08:55.720 --> 0:08:57.199 we're like, wait a second, now, that's going to be 0:08:57.320 --> 0:08:59.120 there's a lot of information, there's lots of cover that 0:08:59.120 --> 0:09:01.120 would take the whole epit, so let's make it into 0:09:01.120 --> 0:09:03.560 a whole episode. So thank you Lauren for absolutely email 0:09:03.559 --> 0:09:05.800 and getting us started down this rabbit hole. But these 0:09:05.920 --> 0:09:10.040 energy incentives, Matt. They were added to the Inflation Reduction Act, 0:09:10.120 --> 0:09:11.839 which passed at the end of last year, which was 0:09:11.880 --> 0:09:16.480 confusingly abbreviated to IRA right yes, which confuses anybody who 0:09:16.520 --> 0:09:18.920 likes to say I hated that there is that overlap, 0:09:19.000 --> 0:09:20.880 and I'm like, oh man, people are going to get confused. 0:09:20.920 --> 0:09:23.520 I know, I know, but well it was also awkwardly named, 0:09:23.559 --> 0:09:25.600 not just for that reason, but also because it wasn't 0:09:25.600 --> 0:09:28.840 really doing much to reduce inflation, right, but it did 0:09:28.920 --> 0:09:31.120 have a bunch of stuff in there on the home 0:09:31.160 --> 0:09:34.360 improvement fronts and a lot of tax incentives to entire 0:09:34.440 --> 0:09:37.000 some owners to start saving money on utilities by by 0:09:37.040 --> 0:09:38.880 doing some of these things that we're talking about today. 0:09:39.160 --> 0:09:40.760 And so basically some of the things that you can 0:09:40.800 --> 0:09:43.680 save money on are like new installation in your home, 0:09:44.040 --> 0:09:47.240 buying an electric vehicle new or used. Actually, interestingly enough, 0:09:47.280 --> 0:09:49.400 that was one of the biggest changes in this bill, 0:09:49.600 --> 0:09:52.240 Putting solar panels on your home, and more. And we'll 0:09:52.280 --> 0:09:54.560 go over a lot of the specific upgrades that you 0:09:54.559 --> 0:09:57.360 can make in this episode. You might be super interested 0:09:57.400 --> 0:10:00.240 in some completely uninterested in others. That's fine. We're going 0:10:00.280 --> 0:10:01.920 to do our best to outline the specifics and in 0:10:02.000 --> 0:10:05.239 the broader strategy actually for how to approach this potentially 0:10:05.280 --> 0:10:08.760 free money or yeah, incentivize money to do something that 0:10:08.880 --> 0:10:11.280 might also be in your best interest over time. And 0:10:11.600 --> 0:10:13.560 the way these rules work, by the way, there's some 0:10:13.600 --> 0:10:15.560 hoops you're going to need to jump through in order 0:10:15.600 --> 0:10:17.840 to get the most out of these new government incentives. 0:10:17.840 --> 0:10:21.040 So we're kind of discussed all like the specifics, Hey, 0:10:21.080 --> 0:10:22.880 here are the things that qualify, and then we'll kind 0:10:22.880 --> 0:10:25.040 of talk about just a general approach too for how 0:10:25.080 --> 0:10:28.800 you maximize your ability to get these tax incentives. That's right. Yeah, 0:10:28.800 --> 0:10:30.600 we're going to get into how to actually pull the 0:10:30.600 --> 0:10:32.559 trigger and make this happen, as well as just how 0:10:32.600 --> 0:10:35.240 to think about some of these upgrades as well. And 0:10:35.360 --> 0:10:37.680 you know, it's important to note that many of these 0:10:37.720 --> 0:10:40.880 different incentives that they've been around for years, but this bill, 0:10:41.000 --> 0:10:43.400 it just sort of sweetened the pot. And so last 0:10:43.480 --> 0:10:45.920 year most of them only had a ten percent credit, 0:10:46.120 --> 0:10:50.520 oftentimes with severely limited maximum amounts. But now it's a 0:10:50.920 --> 0:10:54.079 thirty percent tax credit pretty much across the board. There 0:10:54.120 --> 0:10:57.320 are still annual maximums, which we'll get into, but putting 0:10:57.360 --> 0:10:59.640 in new installation in twenty twenty three, that's going to 0:10:59.679 --> 0:11:01.640 come with all more perks than it did last year 0:11:01.679 --> 0:11:04.240 in twenty twenty two. And you know, this is just 0:11:04.280 --> 0:11:07.480 really another creative way to save money every single month. 0:11:07.520 --> 0:11:10.959 It's not necessarily going to be sexy, like we're talking 0:11:10.960 --> 0:11:12.760 about at the beginning of I feel like maybe the 0:11:12.800 --> 0:11:16.480 sexiest thing is maybe solar in particular, these home energy upgrades, 0:11:16.800 --> 0:11:18.719 especially when we get them at a solid discount like 0:11:18.760 --> 0:11:21.880 this thirty percent off, it can decrease our energy usage 0:11:22.000 --> 0:11:25.200 and therefore our energy bills, saving us money. That's going 0:11:25.240 --> 0:11:27.520 to allow us to reach some of the different financial 0:11:27.520 --> 0:11:29.640 goals that we've set for ourselves. Yeah, and it's just nice. 0:11:29.679 --> 0:11:32.760 I don't know, there's something really satisfying about knowing that 0:11:32.840 --> 0:11:36.120 when you're heating a room or cooling a house or 0:11:36.120 --> 0:11:38.120 something like that, like we're basically starting to do now 0:11:38.160 --> 0:11:41.360 in Atlanta, that those dollars aren't just dissipating through the ceiling, 0:11:41.480 --> 0:11:45.679 right and having something like more insulation, beefing your insulation up. 0:11:46.040 --> 0:11:49.120 Knowing that everything's just working more efficiently, that kind of 0:11:49.120 --> 0:11:50.920 feels good. And maybe that's just like the adult in 0:11:51.000 --> 0:11:53.640 me and my twenty something self would have been like whatever, idiot, 0:11:53.679 --> 0:11:56.600 I don't even go buy beer. But there is something 0:11:56.640 --> 0:11:59.240 really nice about knowing that your air conditioner is not 0:11:59.280 --> 0:12:01.640 working as hard, that everything's just kind of a little 0:12:01.679 --> 0:12:04.120 more optimized, and that that you're saving money actually every 0:12:04.120 --> 0:12:06.640 month on your utility bills. And we will talk more 0:12:06.679 --> 0:12:09.160 than just about insulation. Yeah, there's more. There's a lot 0:12:09.200 --> 0:12:11.240 more too. But and you just mentioned Matt getting these 0:12:11.280 --> 0:12:13.920 upgrades at a discount, so let's quickly touch on how 0:12:13.960 --> 0:12:18.000 these credits work. Tax credits and tax deductions. They might 0:12:18.040 --> 0:12:20.600 be on your brain right now because tax days next week, 0:12:21.480 --> 0:12:23.840 and if you forgot about that, well your friendly reminder 0:12:24.000 --> 0:12:27.120 to your taxes. But a tax deduction is basically a 0:12:27.160 --> 0:12:31.040 reduction deduction, reduction of how much of your income is 0:12:31.040 --> 0:12:33.080 subject to being taxed. And so let's say you have 0:12:33.120 --> 0:12:36.319 an income of seventy five thousand dollars. Well, a ten 0:12:36.360 --> 0:12:39.719 thousand dollars deduction means that you're only going to get 0:12:39.760 --> 0:12:43.240 taxed on sixty five thousand dollars. That's what a deduction is. 0:12:43.240 --> 0:12:46.040 But a tax credit is a dollar for dollar reduction 0:12:46.360 --> 0:12:49.040 of the taxes that you owe, which makes this even 0:12:49.120 --> 0:12:52.600 more lucrative, even more significant. So in this hypothetical example, 0:12:52.600 --> 0:12:55.640 we're talking about a nearly eight thousand dollars difference in 0:12:55.640 --> 0:12:59.240 your tax liability between a ten thousand dollars deduction versus 0:12:59.280 --> 0:13:01.360 a ten thousand dollar our tax credit. And today we're 0:13:01.360 --> 0:13:03.640 talking about tax credits, So don't get them confused. Know 0:13:03.720 --> 0:13:06.880 that these are even even better. And by the way, 0:13:06.880 --> 0:13:09.920 you don't have to itemize either in order to get 0:13:09.960 --> 0:13:13.880 these tax credits, as outlined in the IRA. So if 0:13:13.880 --> 0:13:16.120 you're like, but I don't itemize, I take the standard deduction, 0:13:16.280 --> 0:13:18.559 you can still use these credits to your advantage. Yes, right, Yeah, 0:13:18.600 --> 0:13:20.840 and don't forget that in addition to these federal tax 0:13:20.880 --> 0:13:23.800 breaks that there might also be some incentives from your 0:13:23.920 --> 0:13:27.800 state government and possibly from local utility companies as well 0:13:27.840 --> 0:13:30.840 that can lead to additional savings. There's there's rebates available 0:13:30.880 --> 0:13:33.880 depending on your state that reduces the cost of certain 0:13:34.080 --> 0:13:36.560 new appliances. You can come almost like double dip. Really, 0:13:37.160 --> 0:13:38.960 it's like a triple dip man. You've got you've got 0:13:39.040 --> 0:13:41.320 the federal level, you're getting a benefit of the state 0:13:41.400 --> 0:13:43.480 level from the with the rebates, but then you're saving 0:13:43.520 --> 0:13:46.120 every single month in perpetuity. Yeah. And by the way, 0:13:46.160 --> 0:13:48.200 we're gonna have a lot of links that we're gonna refuct. Oh, 0:13:48.559 --> 0:13:49.840 so there's gonna be a lot up in the show 0:13:49.880 --> 0:13:51.600 notes and how to money dot Com. But specifically when 0:13:51.600 --> 0:13:53.960 it comes to all these state rebates, we'll link. We've 0:13:53.960 --> 0:13:55.640 got a good resource in there that you can check 0:13:55.679 --> 0:13:58.559 and very quickly see. Okay, I live in Massachusetts, where 0:13:58.600 --> 0:14:00.920 I live in Maine, what what is my state offering 0:14:00.920 --> 0:14:03.600 and what are my local utility companies offerings. There's a 0:14:03.600 --> 0:14:06.280 lot that's being offered out there, and these insense they're 0:14:06.280 --> 0:14:09.880 being offered to businesses, even other government agencies as well. 0:14:10.200 --> 0:14:12.200 But of course we're here to address the impact that 0:14:12.240 --> 0:14:15.880 it can have on us as homeowners, as residential customers. 0:14:15.920 --> 0:14:18.080 And so we'll get to the best ways that you 0:14:18.120 --> 0:14:21.120 can use these different energy tax credits to your advantage 0:14:21.440 --> 0:14:33.160 right after this break. All right, Matt, let's keep rolling. 0:14:33.240 --> 0:14:36.120 Let's talk about the energy tax credits are available to 0:14:36.240 --> 0:14:40.560 all Americans, all American homeowners right nationwide, and they can 0:14:40.680 --> 0:14:44.400 make a big difference in how much taxuo come April 0:14:44.520 --> 0:14:47.160 of next year. But they can also make a big 0:14:47.160 --> 0:14:50.080 difference in how livable your home feels in kind of 0:14:50.120 --> 0:14:52.520 how big your utility bills are. And there's a bunch 0:14:52.560 --> 0:14:54.360 of things across the spectrum that we want to touch 0:14:54.360 --> 0:14:56.360 on today. We're gonna get to all a bunch of 0:14:56.400 --> 0:14:59.960 the specific items that you can be looking to replace 0:15:00.280 --> 0:15:01.840 in your home, and then we'll kind of give you, 0:15:01.880 --> 0:15:04.160 like we said, kind of a way of thinking about 0:15:04.160 --> 0:15:06.880 when and how you go about doing these repairs. And 0:15:06.960 --> 0:15:09.160 there's a great chart from Energy dot gov that will 0:15:09.200 --> 0:15:10.840 include in the show notes for this episode they can 0:15:10.880 --> 0:15:13.360 give you just like a quick breakdown. But I guess 0:15:13.480 --> 0:15:15.480 maybe it might make sense to talk about how much 0:15:15.760 --> 0:15:17.640 somebody would stand to save if they do some of 0:15:17.640 --> 0:15:21.280 these improvements. And this is going to vary widely by 0:15:21.440 --> 0:15:23.880 the size of your home, by the climate where you 0:15:23.920 --> 0:15:27.040 live in, and the number of holes in your walls, right, 0:15:27.640 --> 0:15:29.960 and just kind of by the which of these actually 0:15:30.040 --> 0:15:32.160 do you end up doing. Do you just replace your 0:15:32.160 --> 0:15:34.400 air conditioner or do you put on rooftop solars like 0:15:34.440 --> 0:15:35.920 those are all going to make a big difference. But 0:15:35.960 --> 0:15:38.680 some estimates have said that the average American could save 0:15:38.720 --> 0:15:41.720 like two hundred dollars a year on utility bills alone 0:15:41.760 --> 0:15:44.000 if they implement a couple of these things, which again 0:15:44.040 --> 0:15:46.720 that's a double win, right, because you're improving your home 0:15:46.720 --> 0:15:48.680 and at the same time you're saving money. But some 0:15:48.760 --> 0:15:50.360 of these are going to pay off more than others, 0:15:50.360 --> 0:15:52.560 and there's a way to approach really how and when 0:15:52.600 --> 0:15:54.920 you're making these improvements. But let's go ahead and Matt 0:15:54.920 --> 0:15:56.960 and dive into some of the different equipment upgrades that 0:15:57.000 --> 0:15:58.880 you can make in order to save money. Let's get 0:15:58.880 --> 0:16:01.880 to the details, right, Yeah, So we've already mentioned a 0:16:01.920 --> 0:16:04.080 couple times now. But let's just make sure we hammer 0:16:04.120 --> 0:16:06.360 the point home and folks know that we're all about 0:16:06.440 --> 0:16:08.960 insulating your home. It really is like the lowest hanging 0:16:08.960 --> 0:16:10.920 fruit when it comes to is, and it always has been, 0:16:10.960 --> 0:16:13.440 but now the incentives make it richer. And what's so 0:16:13.440 --> 0:16:15.120 great about it too is that it really can be 0:16:15.200 --> 0:16:18.560 like this diy job. Like I've done blow in insulation 0:16:18.600 --> 0:16:21.000 before in my house. Ideally you've got a couple of folks, 0:16:21.120 --> 0:16:22.640 you know, you got somebody else there to help you out. 0:16:22.640 --> 0:16:25.920 They loaded in at the bottom, someone to cellulos. If 0:16:25.920 --> 0:16:28.000 you're going for the blow in style, you can see 0:16:28.000 --> 0:16:30.400 a little bit easier to do the bats that you 0:16:30.520 --> 0:16:33.880 roll out. But there's a cap of twelve hundred dollars 0:16:33.920 --> 0:16:36.920 a year, and so we're really talking about hopefully not 0:16:36.960 --> 0:16:39.360 spending more than four thousand dollars in materials in a 0:16:39.400 --> 0:16:43.400 given year, which would be a significant amount of material 0:16:43.720 --> 0:16:45.720 But were you to hit that dollar amount, that will 0:16:45.760 --> 0:16:47.760 help you to minimize your out of pocket and then 0:16:47.880 --> 0:16:50.560 you would actually be fully maximizing the credit that's being 0:16:50.600 --> 0:16:53.280 offered in this case. But how much we're putting in 0:16:53.320 --> 0:16:56.480 additional insulation save you well, like you said, Jill, every 0:16:56.560 --> 0:16:58.440 home is going to be different. But the Department of 0:16:58.520 --> 0:17:01.560 Energy they say that insulating your home home well that 0:17:01.560 --> 0:17:03.560 I can stay close to ten percent of the overall 0:17:03.760 --> 0:17:07.720 energy costs of a home or fifteen percent of the 0:17:07.840 --> 0:17:11.640 heating and cooling costs associated with keeping your home comfortable. 0:17:11.960 --> 0:17:15.119 So a lot of this depends on your current installation situation. 0:17:15.240 --> 0:17:17.640 But this, on one hand, you might be thinking, dude, 0:17:17.640 --> 0:17:21.240 that's chump change, But just think about the compounding impact 0:17:21.240 --> 0:17:23.920 that that has over the years, as that is something 0:17:23.920 --> 0:17:26.040 that you're able to realize. That's the savings you're able 0:17:26.080 --> 0:17:28.439 to personally realize for years to come. Yeah, so if 0:17:28.440 --> 0:17:30.679 you're talking about saving twenty bucks a month, because you 0:17:30.720 --> 0:17:32.840 toss that in, that could be you know, almost two 0:17:32.880 --> 0:17:35.879 hundred fifty bucks a year. In addition to the fact that, 0:17:36.000 --> 0:17:38.920 let's say, because of the federal tax rebait, really putting 0:17:38.920 --> 0:17:42.320 that insulation in might only cost you like fifteen hundred bucks. 0:17:42.359 --> 0:17:44.679 So you're talking about then a six year payback period. 0:17:45.000 --> 0:17:47.920 And we'll talk more about payback periods in just a bit. 0:17:48.119 --> 0:17:49.760 But the reason we want to start with insulation is 0:17:49.800 --> 0:17:51.359 of course because it's one of the easiest things and 0:17:51.400 --> 0:17:53.720 there's a ton of homes across this country map where 0:17:53.720 --> 0:17:56.719 people just do not have an insulation, enough insulation, especially 0:17:56.720 --> 0:17:59.159 if you're in an older home in the neighborhood that 0:17:59.200 --> 0:18:00.920 we just moved from. Some of the houses even near 0:18:00.960 --> 0:18:03.960 by us that were built in the thirties, forties, fifties, 0:18:04.280 --> 0:18:06.359 there are a lot of homes that just don't have 0:18:06.600 --> 0:18:08.600 very much and it's just costing you a ton of 0:18:08.640 --> 0:18:12.480