Sponsors
The bill provides modest, targeted tax relief for household energy costs for lower- and middle-income households but limits who benefits (nonrefundable design and income phaseouts) and creates new administrative burdens for landlords, tenants, and tax administrators.
Low- and moderate-income households (owners and renters) can reduce federal income tax on home electricity and gas costs by up to $350 per year.
Benefit is targeted to primary residences and is accessible to renters because landlords must provide annual utility-portion receipts, directing relief to household energy burdens rather than businesses or second homes.
Very low-income filers who owe little or no federal income tax may be unable to use the nonrefundable $350 credit and thus receive limited or no benefit.
Landlords, renters, and the IRS face added administrative and compliance burdens from allocating utility portions of rent, issuing and tracking receipts, and coordinating claims.
Taxpayers with adjusted gross income above the phaseout thresholds (>$400,000 joint; >$200,000 other) are excluded entirely and receive no benefit.
Based on analysis of 2 sections of legislative text.
Establishes a nonrefundable tax credit up to $350 per year for qualified gas and electric costs at a taxpayer's main home, with income-phaseouts and landlord reporting rules.
Introduced January 22, 2025 by Josh S. Gottheimer · Last progress January 22, 2025
Creates a new nonrefundable personal tax credit worth up to $350 per year to help individuals pay qualified gas and electric costs for their primary home, including utility charges paid through rent. The credit is phased out for higher-income taxpayers (above $400,000 for joint filers and $200,000 for other filers) and cannot be claimed for expenses already used to get another tax benefit. Landlords who include utility charges in rent must provide an annual receipt to the IRS and the tenant by January 31 for the prior year. The credit applies to amounts paid or incurred after enactment.