Federal tax credits provide a valuable incentive for energy-efficiency upgrades. A new tool released by the Department of Energy (DOE) is helping contractors and homeowners determine what credits they are eligible for.

In October, the DOE announced several new resources to assist U.S. energy efficiency contractors and the homeowners who hire them. The tools will help them identify and understand the thousands of dollars in federal tax credits they may be eligible for because of the improvements.

The first one, known as the Tax Credit Product Lookup Tool, can help determine if new heating, air-conditioning or water-heating equipment may be eligible for an Energy Efficient Home Improvement Credit. Information can be entered into the tool about a particular product to determine if it meets tax credit eligibility criteria. The tool will produce a single-page report that can be printed or saved for future records.

The second tool, the home insulation explainer, walks contractors and homeowners through the key elements of home insulation and air-sealing products that can lower utility bills and qualify for tax credits.

Finally, the new contractor training module, a free 30-minute video, provides detailed introductory information on how contractors can leverage residential energy-efficiency incentives, including those available from federal, state, local and utility-run programs.

The Energy Efficient Home Improvement Credit allows households to receive up to $3,200 in tax credits annually for a variety of energy-efficient home improvements. The DOE notes that more 2.3 million families have already claimed the credit for a total of over $2 billion. Their savings amount to an average of $880 per household, according to data from the U.S. Department of the Treasury.