Home Remodeling Tax Incentives for Memphis Homeowners
Homeowners in Memphis, Tennessee, considering home, kitchen, or bathroom remodeling projects may be eligible for various tax incentives and financial assistance programs at the federal, state, and local levels.
Federal Tax Credits and Local Rebates
Memphis Home Remodeling Tax Incentives and Local Rebates
At Gardner Construction Solutions, we believe home remodeling should be as smart financially as it is beautiful. That’s why we help Memphis-area homeowners take advantage of available tax incentives, rebates, and energy efficiency credits to stretch your remodeling dollars further.
Whether you’re remodeling your kitchen, remodeling your bathroom, adding a home office, building a new home addition, or building an outdoor living space, there are several remodeling tax incentives available to you. Thanks to the Federal Inflation Reduction Act and other local opportunities, you could significantly reduce your out-of-pocket costs as well as your tax liability.
Available Tax Credits & Local Rebates for Home Remodeling in Memphis, TN
When planning your next home renovation, it’s important to know that your investment can do more than just improve your living space—it can also put money back in your pocket. Homeowners in the Greater Memphis area may be eligible for a variety of federal tax credits and local utility rebates designed to encourage energy-efficient and accessible home upgrades. At Gardner Construction Solutions, we help you identify and take advantage of these opportunities so your remodel is as smart financially as it is beautifully designed.
Federal Tax Incentive
1. Energy-Efficient Home Improvements (Section 25C)
Eligible Upgrades Include:
- Energy-efficient windows and doors
- Home insulation improvements
- Heat pumps and high-efficiency HVAC systems
- Solar panels and battery storage
- Electric panel upgrades
- Energy-efficient water heaters (including solar)
- Home Energy Audits
How Much Can You Save?
- Up to 30% of the cost of qualifying improvements
- Annual limits of up to $3,200 per year
- Up to $2,000 for select systems like heat pumps
- No cap for solar systems — a full 30% credit
💡 Gardner Construction can help design and build a home remodel, kitchen remodel, or bathroom remodel that checks the boxes for these tax credits.
Federal Tax Incentive
2. Residential Clean Energy Credit (Section 25D)
What This Credit Covers:
- Solar photovoltaic (PV) panels
- Solar water heaters
- Geothermal heat pumps
- Small wind turbines
- Battery storage systems
How Much Can You Save?
- 30% of the total project cost through 2032
- Phases down in 2033 (26%) and 2034 (22%)
📝 Homeowners who install solar panels or battery storage can take advantage of long sunlight hours, reduce their reliance on the power grid, and potentially increase their home value.
Federal Tax Incentive
3. Reduce Capital Gains Tax with Major Home Improvements
What Types of Home Improvements Qualify?
- Kitchen Remodelings
- Bathroom Remodeling
- Room additions (like in-law suites or bonus rooms)
- Outdoor kitchens & fireplaces
- HVAC or plumbing upgrades
- New roofing or siding
- Landscaping that adds value
- New flooring, electrical systems, insulation, or energy upgrades
How Much Can You Save?
- Individual tax filers can exclude up to $250,000 in profit
- Married Filing Jointly couple can exclude up to $500,000
- Keeping records of all remodeling expenses is essential
More Information:
🧾 Always save receipts, contracts, and before/after photos for proof!
Federal Tax Incentive
4. Home Accessibility Renovation Deductions
Qualifying Accessibility Projects:
- Walk-in tubs or showers
- Wheelchair Ramps
- Lowered or modified cabinets and countertops
- Stair lifts, porch lifts, and other lift systems
- Installing railings, support bars, or other modifications to bathrooms
- Moving or modifying electrical outlets and fixtures
- Adding handrails or grab bars anywhere
- Grading the ground to provide access to the residence.
Tax Deduction Limits & Rules:
- The total deduction for medical expenses (including home improvements) must exceed 7.5% of your Adjusted Gross Income (AGI) to qualify
- Deduction only applies to unreimbursed expenses
- You must itemize deductions on Schedule A (Form 1040)
📝 These deductions require a healthcare provider’s recommendation and must not increase your property value to qualify fully. Always consult with your tax advisor.
Tennessee home efficiency rebate
5. Home Energy Performance-Based Whole House Rebate
More Information:
📝 These rebates are conditional and subject to Section 7 of President Trump’s Executive Order on “Unleashing American Energy”
Tennessee home efficiency rebate
6. High-Efficiency Electric Home Rebate Program
More Information:
📝 These rebates are conditional and subject to Section 7 of President Trump’s Executive Order on “Unleashing American Energy”
Memphis Light, Gas and Water (MLGW) Programs
7. Share the Pennies Program
More Information:
Memphis Light, Gas and Water (MLGW) Programs
8. Home Uplift Program
More Information:
What is the Inflation Reduction Act?
The Inflation Reduction Act (IRA), signed into law on August 16, 2022, is a landmark piece of legislation aimed at addressing climate change, lowering healthcare and prescription drug costs, and reducing the federal deficit. One of the central components of the IRA is the expansion and creation of federal tax credits designed to accelerate the adoption of clean energy technologies and energy-efficient practices for both individuals and businesses.
These tax credits serve as financial incentives to encourage investments in renewable energy, electric vehicles, home energy efficiency upgrades, and domestic clean energy manufacturing.
How Can Homeowners in Memphis Benefit from the Inflation Reduction Act?
The Inflation Reduction Act of 2022 provides significant financial incentives to help homeowners across the U.S.—including Tennessee—make energy-efficient improvements to their homes, lower utility bills, and reduce their carbon footprint. These benefits come in the form of tax credits, rebates, and incentive programs.
Let’s Get Your Project Started
Schedule A Free Consultation for Home Remodeling Project
The first thing you will want to do is schedule an onsite consult with us. Our consultations are free and you’re not obligated to work with us even after we meet together.
We’ll discuss your needs and desires and begin designing your space and building out a timeline for your project.
