Wood Stove Tax Credit 2025: How to Save Up to $2,000 with an EPA Certified Stove
If you’re planning to upgrade to a wood or pellet stove this year, don’t miss out on the wood stove tax credit 2025, one of the smartest incentives available for homeowners who heat with wood.
Through the Energy Efficient Home Improvement Credit, you can claim 30% of the total cost, including installation, of a qualifying EPA-certified stove, up to $2,000. It’s a great way to reduce your tax bill while making your home cleaner and more efficient.
In this guide, I’ll break down who qualifies, which stoves are eligible, how much you can save, and the key forms and deadlines to watch. I’ll also cover common mistakes to avoid, so you can make the most of this generous federal credit.
What Is the Wood Stove Tax Credit in 2025?
The wood stove tax credit 2025 is part of the federal government’s Energy Efficient Home Improvement Credit, introduced through the Inflation Reduction Act. It’s designed to help homeowners offset the cost of upgrading to cleaner, more energy-efficient heating options, including wood, pellet, and other biomass-fueled stoves.
Under the current rules, you can claim 30% of the total cost (including installation) of a qualifying stove, up to a $2,000 annual limit. That’s a big deal for anyone considering a new EPA-certified wood stove, especially if it’s part of a larger home efficiency upgrade.
And to be clear, this isn’t a rebate or a deduction. It’s a non-refundable tax credit, meaning it reduces the amount of tax you owe to the IRS, dollar-for-dollar. But if your tax bill is smaller than the credit, you won’t get a refund for the leftover amount.
To qualify, the stove must meet strict EPA efficiency standards and be installed in your primary or second home between January 1 and December 31, 2025.
Key Takeaways
- 30% Tax Credit: Claim 30% of total cost (stove + installation) back as a tax credit, up to $2,000 in 2025.
- Eligibility: Stove must be EPA-certified with ≥75% efficiency (HHV) and installed by Dec 31, 2025.
- What’s Covered: Costs include the stove, chimney or venting, and professional installation.
- Filing Process: File using IRS Form 5695 and include the manufacturer’s certificate plus all receipts.
- Avoid Disqualification: Confirm efficiency, save all documents, and don’t delay your installation.
What Qualifies for the Wood Burning Stove Tax Credit 2025?
To qualify for the wood burning stove tax credit 2025, your stove must be EPA certified and have a thermal efficiency of at least 75% (HHV), a requirement set by ENERGY STAR. This ensures your stove burns cleaner and performs efficiently.
A biomass stove, simply put, is one that burns organic fuel like wood, pellets, or agricultural waste to heat your home. These newer, efficient models are a major step up from older units, which is exactly why this tax credit was created.
What expenses are covered? The credit applies to:
- The cost of the stove or insert
- Professional installation
- Venting or chimney work (if required by the manufacturer)
One crucial detail: always request a manufacturer’s certificate confirming your stove meets the requirements, you’ll need it when filing with the IRS.
RELATED: How Does A Wood-Burning Stove Work?
How the Pellet Stove Tax Credit 2025 Actually Works
Here’s the simple version: the wood stove tax credit in 2025 lets you claim 30% of the total cost of your qualifying stove and installation, up to $2,000 per year. That’s not a deduction, it’s a direct credit that reduces what you owe on your federal taxes.
For example, if your new pellet stove and installation cost $6,500, you could get back $1,950 as a tax credit. Not bad for an upgrade that keeps your home warm and efficient.
To claim it, you’ll need to file IRS Form 5695 when you do your 2025 tax return. That form covers the Energy Efficient Home Improvement Credit, where this benefit lives.
And just a quick note: you might’ve seen references to a 26% stove credit, that applied to older rules. The current rate is 30% and applies through the end of 2025 under the Inflation Reduction Act.
Key 2025 Timeline & U.S. Biomass Tax Credit Rules
The wood stove tax credit, part of the broader US biomass tax credit in 2025 under the energy efficient home improvement credit, offers up to $2,000 in savings for homeowners who make smart, certified upgrades. It’s an excellent opportunity to invest in a cleaner, cozier, and more efficient way to heat your space.
To qualify, your stove must be installed (not just purchased) between January 1 and December 31, 2025. Starting next year, you’ll also need to include the Qualified Manufacturer Identification Number (QMID) on your IRS Form 5695 to verify eligibility.
And don’t forget the paperwork: hang on to your receipts, installation invoices, and the manufacturer’s certificate, they’ll be your proof if the IRS asks.
Choosing the Right EPA-Certified Stove (and Common Pitfalls)
One of the most common mistakes I see is folks picking a stove based purely on price, only to find out later it doesn't qualify for the wood stove tax credit 2025. To avoid that frustration, make sure any stove you’re considering checks these boxes:
- EPA certified
- At least 75% efficiency (HHV)
- Comes with a manufacturer’s certificate confirming it qualifies
Most reputable brands build their stoves with tax credit eligibility in mind. Models like the Drolet HT-3000 or Century’s S250 wood stove blend performance with certification, so you’re not just staying warm, you’re also making a smart investment.
Just remember: low-cost stoves without documentation can disqualify you from the credit entirely. It's worth confirming with the seller or manufacturer before you buy.
Looking for something smaller or mobile-friendly? Take a peek at our wood stoves for mobile homes for space-saving, tax-credit eligible options.
Final Checklist to Claim the Wood Stove Tax Credit 2025
Before you purchase a wood or pellet stove, use this checklist to make sure you’ll qualify for the EPA certified wood stove tax credit and avoid any last-minute surprises:
What to Do
| What to Do | Why It Matters |
|---|---|
| Confirm the stove is EPA-certified | Only EPA-certified stoves are eligible for the 2025 tax credit. Check the label or ask the seller. |
| Check for ≥75% efficiency (HHV) | The stove must be rated at 75% efficiency or higher, as required by ENERGY STAR. |
| Ask for a manufacturer’s tax credit certificate | This document proves your stove qualifies for the credit. You’ll need it when filing taxes. |
| Plan to install before Dec 31, 2025 | The stove must be installed, not just purchased, before the year ends to claim the credit. |
| Save all purchase and installation receipts | The IRS may request proof of purchase and install costs to verify your claim. |
| Download and complete IRS Form 5695 | This is the form you’ll use to claim the credit on your 2025 tax return. |
Get Help & Browse Qualifying Wood Stoves
If all this feels like a lot to track, from stove specs to IRS forms, you’re not the only one. Many homeowners find the details overwhelming at first, especially when trying to make sure their stove will qualify for the fireplace tax credit 2025.
That’s why we recommend starting with trusted, tax-credit-ready brands like Drolet, Century Heating, Ventis, and Timberwolf. These manufacturers offer EPA certified wood stoves and inserts that meet the required 75% efficiency and come with manufacturer documentation.
Whether you're looking to heat a full-size home or a cozy cabin, our team can help you choose a model that fits your space, and the IRS criteria.
ALSO READ: Best Wood Stove Brands for Every Home in 2025
FAQ: Fireplace & Wood Stove Tax Credit Questions
How to claim wood stove tax credit?
Install a qualifying EPA-certified stove with at least 75% efficiency. Save all receipts and the manufacturer’s tax certificate. Then file IRS Form 5695 with your tax return for the year the stove was installed. Documentation is key to claiming the credit.
What is a biomass stove?
A biomass stove burns renewable fuels like wood logs, wood pellets, or agricultural waste to generate heat. To qualify for the tax credit, the unit must be EPA certified and meet or exceed 75% efficiency (HHV) according to federal energy standards.
Does a wood stove qualify for energy tax credit?
Yes, if it’s a biomass-fueled EPA-certified wood stove with at least 75% HHV efficiency. The unit must be installed between Jan 1 and Dec 31, 2025. Always confirm with the manufacturer’s certificate and keep records for your tax return.
How does the 26% wood stove tax credit work?
The 26% credit applied under the previous Section 25D tax program for installations completed before 2023. That credit has since been replaced with a new 30% tax credit (up to $2,000) available through 2025 under the Inflation Reduction Act.
How does the wood stove tax credit work
You purchase and install a qualifying stove, then claim 30% of the total cost (up to $2,000) on your federal taxes using IRS Form 5695. It’s a non-refundable credit, meaning it directly reduces your tax bill, but won’t create a refund.
What IRS form do I use for wood stove tax credit?
To claim the wood stove tax credit 2025, use IRS Form 5695, “Residential Energy Credits.” Include your receipts, the manufacturer’s certificate, and the Qualified Manufacturer Identification Number (QMID) if applicable starting in 2025.
Conclusion: Save Money While Staying Warm in 2025
The wood stove tax credit 2025 is one of the smartest ways to invest in your home this year, offering up to $2,000 in savings through the energy efficient home improvement credit. It’s a rare chance to upgrade to a cleaner, cozier, and more efficient heating solution while putting real money back in your pocket.
Just be sure to choose a qualifying EPA-certified stove, get it installed before December 31, 2025, and hold onto your documentation, including the manufacturer’s certificate and receipts, to make tax time a breeze.
If you’re ready to take the next step or need help finding the right model, we’re here for you. From trusted brands like Drolet, Century Heating, and Ventis, to guidance on paperwork and install timing, we’ve got your back every step of the way.
