Window Replacement Tax Credits and Rebates in Texas — What El Paso Homeowners Can Claim

If you have been putting off replacing draughty, single-pane windows because you were waiting for a tax credit to soften the bill, 2026 brings news you need to hear before you sign anything: the federal credit that many homeowners counted on is gone for new installations, but a live El Paso Electric rebate can still cut the cost of qualifying windows. Knowing which incentive applies to your project — and which one no longer does — is the difference between a pleasant surprise and a disappointing tax return.

This guide sets out, in plain language, what El Paso homeowners can still claim in 2026, what ended on 31 December 2025, and how to make sure a replacement project qualifies for the rebate that remains. It is general information, not tax advice — check the details with your tax professional before you rely on any figure.

The federal window tax credit has ended for 2026 installations

For several years, the federal Energy Efficient Home Improvement Credit (Section 25C) let homeowners claim 30% of the product cost of qualifying windows, up to $600 a year for windows and skylights, within a wider $1,200 annual limit for general home improvements. The credit covered the cost of the windows themselves, not the labour to fit them, and it applied only to an existing home you own and use as your main residence.

The One Big Beautiful Bill Act, signed on 4 July 2025, ended that credit for any property placed in service after 31 December 2025. That date is the one that matters: the IRS treats the installation as complete when the work is finished, not when you signed the contract or ordered the windows. So windows fitted in 2026 do not qualify for the federal credit, however efficient they are.

If your windows were installed during 2025, the story is different. You can still claim the credit on the 2025 return you file in 2026, using IRS Form 5695, provided the windows met the ENERGY STAR Most Efficient standard and you include the manufacturer’s four-character identification code. The credit is non-refundable, which means it can reduce the tax you owe to zero but cannot create a refund, and any unused part cannot be carried forward to a later year. If that describes your 2025 project, do not leave the claim off your return — but do not expect the same credit for a 2026 installation.

There is no Texas state tax credit for replacement windows

Texas offers no statewide tax credit for window replacement, so there is no state form to file and no state credit to add on top of a federal claim. That makes the local utility rebate, covered next, the main incentive still available to El Paso homeowners in 2026. It also means any contractor or advert that promises you a “Texas window tax credit” for a 2026 project deserves a hard question before you believe it.

The incentive that is still live: the El Paso Electric window rebate

El Paso Electric’s Texas Residential Solutions programme offers rebates to residential customers in its Texas service area who install qualifying ENERGY STAR windows. Unlike a tax credit, a rebate is money back after the work — it does not depend on your tax bill, and it does not have to be repaid if the programme conditions are met.

To qualify, the windows must meet ENERGY STAR specifications: a U-factor of 0.28 or lower and a solar heat gain coefficient (SHGC) of 0.23 or lower. In plain terms, the U-factor measures how well the window keeps heat where it belongs, and the SHGC measures how much of the sun’s heat passes through the glass — both matter enormously in El Paso, where summer sun pours through west-facing glass for hours every afternoon. Your existing windows must be single- or double-pane with clear glass, and new-build projects are not eligible. The windows must also be bought and fitted within the current programme year.

The rebate is calculated per square foot of window area, including frame and sash, and the rate depends on your home’s cooling system and what you are replacing. For a home with refrigerated air cooling, the rate is $1.35 per square foot when replacing single-pane windows and $0.97 per square foot for double-pane. For evaporative cooling, the rates are $0.37 and $0.28 per square foot. El Paso Electric’s own example shows the maths: 300 square feet of single-pane windows replaced in a refrigerated-air home earns an estimated $405. The rebate cannot exceed the total project cost, and funding is limited — rebates are issued first come, first served until the money runs out or the programme changes, so early confirmation matters more than a vague plan to “apply later”.

Enhanced help if your household income qualifies

El Paso Electric also runs a Texas Income Qualified programme offering enhanced incentives to eligible customers. If your household income falls within the programme’s limits, it is worth checking that route before you settle for the standard rebate — the same windows may earn you more. Ask your contractor to check the income eligibility form with you at quote stage, not after the windows are already ordered, because the enhanced route has its own paperwork and qualifying steps.

How to make sure your project qualifies before you buy

The most expensive mistake with rebates is fitting beautiful windows first and discovering afterwards that they miss a specification by a fraction. Work through this checklist with your installer before you order:

First, confirm the exact window specification in writing — U-factor 0.28 or lower and SHGC 0.23 or lower — and keep the manufacturer’s ratings sheet. Second, confirm that your home and existing windows fit the programme: Texas residential customer in El Paso Electric’s service area, existing single- or double-pane clear glass, and an existing home rather than new construction. Third, agree who handles the paperwork and when: the rebate application needs an itemised invoice, photographs of the old and new windows, and the product ratings, so photograph the old windows before they come out. Fourth, check the current programme terms at quote stage, because funding limits and rules can change during the year. A contractor who knows the programme will do all of this without being asked — and if yours cannot, that tells you something useful before you commit.

Solar screens are also rebate-eligible under the same El Paso Electric programme, which is worth knowing if your budget will not stretch to full window replacement options this year. Screens cut solar heat gain on the worst west-facing glass and can be a sensible interim step, but they are not a substitute for failed seals, rotten frames, or windows that no longer close properly.

What about the rest of the cost?

Even with a rebate, replacement windows are a significant purchase, and the rebate alone will not carry the project. That is where planning the job properly pays for itself: choosing the right glass package for El Paso’s heat, replacing the worst rooms first if you cannot do the whole house at once, and getting a quote that separates product cost from labour so you can see exactly what any future incentive would apply to. Our guide to the cost of replacing the windows in a three-bedroom home sets out realistic El Paso price ranges, and our vinyl-versus-fibreglass comparison explains which frame material copes best with desert heat — both are worth reading before you choose. If you are replacing every window in the house, our full-home window installation guide walks through the whole-house process, scheduling, and what to expect on installation day.

Frequently asked questions

Can I claim a federal tax credit for windows installed in 2026?

No. The federal Energy Efficient Home Improvement Credit ended for property placed in service after 31 December 2025. Windows fitted in 2026 do not qualify, whatever their efficiency rating.

Can I still claim the credit for windows installed in 2025?

Yes, if they were installed and placed in service by 31 December 2025, met the ENERGY STAR Most Efficient standard, and were fitted in your main residence. Claim it on your 2025 return, filed in 2026, using IRS Form 5695, and include the manufacturer’s identification code. The credit was 30% of product cost only — labour excluded — capped at $600 for windows.

How much is the El Paso Electric window rebate worth?

It depends on your cooling system and existing windows: up to $1.35 per square foot for single-pane windows in a refrigerated-air home, $0.97 for double-pane, and $0.37 or $0.28 per square foot for evaporative-cooled homes. A 300-square-foot single-pane project in a refrigerated-air home works out to roughly $405. The rebate cannot exceed your project cost, and funding is limited.

Do I need to use a particular contractor to get the rebate?

You can work with a contractor or apply yourself, but confirm eligibility and paperwork before installation either way — and keep photographs of the old windows, the itemised invoice, and the product ratings. Our local window team checks rebate eligibility at quote stage so nothing is left to chance.

Is there a Texas state tax credit for windows?

No. Texas offers no statewide tax credit for window replacement. For a 2026 project, the El Paso Electric rebate is the incentive to pursue, alongside any manufacturer promotion running at the time.

The honest summary for 2026 is this: the federal credit has closed, the state offers no substitute, and the El Paso Electric rebate is the real money still on the table — but only for qualifying windows, fitted in the programme year, while funding lasts. Get the specification right before you order, keep your paperwork tidy, and let the rebate do what it can. For a free quote on window replacement options that meet the rebate standard, call Window Installation El Paso on (915) 288-9621 — and if you replaced windows in 2025, talk to your tax professional about Form 5695 before you file.

Related reading: cost to replace windows in a 3-bedroom El Paso home · vinyl vs fibreglass windows for El Paso heat