Reducing energy use has big payoffs for businesses that build and renovate.
Earth-friendly materials, products and processes have now been around for decades, and their popularity isn’t slowing down. Many contractors and builders have adopted these “green” principles and adapted their practices to reduce their carbon footprint. In addition to the positive effects on the environment, enacting these standards has also had a positive impact on businesses’ bank accounts.
Energy-Efficiency Pays Off on Your Taxes
Often, eco-friendly options are a more expensive investment for companies of all sizes. The federal government acknowledges this, and has tax laws in place to reward businesses for their investment. The IRS offers credits and deductions in specialty areas of the tax code that builders can use to offset their costs and invest back into projects or business costs. There are two types of energy-efficiency incentives:
179D Energy Efficient Tax Deduction
Who is it For? Architects, contractors, builders, commercial building owners, and anyone who does government-funded projects.
What are the Perks? A deduction of up to $1.80 per square foot per project. You can read more about this deduction here.
How Do I Cash In? Qualifying for 179D requires an independent, third-party firm to evaluate the building’s components and detail the energy savings. Partner with tax experts can confirm your eligibility for this tax reward.
45L Energy Efficient Home Credit
Who is it For? Multi-family developers, contractors, and owners who build or upgrade projects to include energy-efficient systems or features, such as an envelope structure that reduces electricity use.
What are the Perks? A credit of up to $2,000 per qualifying dwelling. You can read more about this deduction here.
How Do I Cash In? The first step toward applying for the 45L credit is a detailed energy analysis that must be certified and documented by a third-party licensed professional. A Qualified tax professional can walk you through this process so you’re one step closer to claiming your reward.
Are You Taking Advantage of Your Rewards?
Obtaining top-dollar benefits from specialty areas of the tax code is National Tax Group’s top priority. Our assessment of benefits is always free. We’ll work with you to determine your eligibility and then provide all documentation needed to obtain these energy-efficient based tax incentives. Discover your savings with a free assessment.