The "Green Energy Building" 179D/45L are Retroactively Renewed - ELB Consulting

Bipartisan Budget Bill includes energy efficient provision

Today, with the passing of the Bipartisan Budget Act, the EPAct Energy Efficient Commercial and Residential Building deductions were retroactively extended for 2017. This provision had previously expired on 12/31/2016.

Initially, EPAct 2005 created this 179D/45L Energy Efficient Commercial Building Tax Incentives with the goal of the to providing developers/owners tax incentives to offset the increased costs of constructing energy efficient (“GREEN”) commercial buildings.

  • The 179D provides a federal tax Deduction of up to $1.80/SF
  • The 45L provides a $2,000 tax Credit per qualified residential unit

These Energy Tax Incentives look at the building subsystems: Envelope, Lighting, and HVAC/Hot Water, with the goal of reducing the property’s carbon footprint. Building owners can qualify not only on new construction, but for any building that has done energy efficient lighting upgrades.

179D example| 100,000 SF energy efficient commercial building could realize $180,000 tax deduction. If a lighting upgrade alone is done, that could be a $60,000 tax deduction.

45L example | 250 qualified apartments, that’s 250 x $2000 = $500,000 tax credit

Thanks to this retroactive extension, any commercial building built or renovated since 2006 may be eligible, and certainly those who were put “in service” last year (2017) can take advantage of this tax deduction. Many have been waiting for this news.

Contact me today to learn more and determine if your buildings qualify.

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