45L is the Tax Saving Secret Building Owners Don’t Want to Miss

Earn $2,000 per unit under this lucrative tax perk for commercial property owners.

Builders, contractors and owners should make the 45L credit part of their construction and remodeling practices. 45L, also known as the Energy Efficient Home Credit, is an underused tax perk that can result in a lucrative outcome for those who apply.

Housing that Qualifies for 45L:

  • Single-family homes
  • Condominiums
  • Student Dorms
  • Assisted Living Communities
  • Townhomes
  • Apartments

Buildings under construction can also redeem the 45L credit, as long as it will reduce heating and cooling energy use by at least 50%, and has a building envelope structure that accounts for at least 20% of this reduction.

A Closer Look

Let’s look at how 45L can benefit building professionals in the real world. Assume Company “A” built a low-rise assisted living facility in Boca Raton, FL in August 2019. The building is 3 stories tall with 150 units total. Company “A” owned the property during the construction phase, which qualifies it as an “eligible contractor” that can apply for 45L. Since each unit is worth $2,000 in tax credits, and the property contains 150 units, XYZ Company is in a position to receive a tax credit of $300,000.
Assuming an additional 30 units will be completed three months later, Company “A” can also claim these new units through the 45L credit, receiving an additional $60,000, for a total tax credit of $360,000. The federal depreciable basis of the assisted living facility would also be reduced by $360,000. For companies with multiple properties, the savings multiply greatly.

Take the Next Step in Savings

Our tax experts specialize in niche tax areas such as the 45L Energy Efficient Home Credit, so that you can leverage for your biggest return yet. Contact us for a free assessment of your properties.

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