Congress·In Committee·S. 1345

Congress Proposes Bigger Tax Credits for Biomass Stoves and New 30% Credit for Biomass Heating

America's First Fuels Act

12 months ago·View on Congress.gov

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Stalled

No legislative action in over 90 days.

Legislative Progress

Senate

House

President

Law

Key Points

Congress would raise the tax-credit cap for some home energy upgrades that include biomass stoves and boilers.
Starting after Dec. 31, 2025, the bill sets a $2,000 limit for one group of qualifying items and a $10,000 limit for another group that includes biomass equipment.
The bill would create a new 30% investment tax credit for certain biomass heating property used to make heat, hot water, or steam for buildings or industrial uses.
To qualify for the new 30% credit, boilers and furnaces would have to meet efficiency, indoor-installation, size, and emissions-control requirements.
If passed, this could lower upfront costs for some homeowners and businesses that install qualifying biomass heating systems, but savings depend on tax situation and project costs.

TaxesEnergyRenewable EnergyEnvironment

Impact Analysis

Personal Impact

How this policy affects specific groups of people

Mixed Impacts(3)

Renter

Neutral

Chronic Illness

Neutral

Child Tax Credit

Neutral

Positive Impacts(6)

Housing Assistance

Helps

Homeowner

Helps

Small Business Owner

Helps

Gig Worker

Helps

Farmer Rancher

Helps

Union Member

Helps

Milestones

2 milestones2 actions

Apr 8, 2025Senate

Read twice and referred to the Committee on Finance.

Apr 8, 2025

Introduced in Senate

What Happens Next

Projected impacts based on AI analysis

2026-01-01

Higher home energy credit limit applies to qualifying biomass property placed in service

If you install a qualifying biomass stove/boiler and it is considered “placed in service” after Dec. 31, 2025, you may be able to claim a larger federal tax credit than before (up to the new cap).

2026-01-01

New 30% credit becomes available for qualifying open-loop biomass heating property

Businesses (and other eligible taxpayers) that put qualifying biomass heating equipment into use after Dec. 31, 2025 can reduce their federal tax bill by 30% of the equipment’s cost, if all requirements are met.

Early 2027 tax filing season (for many 2026 installations)

Tax filing season when many people first claim these post-2025 credits

Most households and businesses would feel the benefit when filing the first tax return that covers a 2026 installation (timing varies by taxpayer). Keep receipts, model specs, and installation paperwork to support the claim.