Energy Efficiency Incentives

Jul 17, 2025

The §45L Energy Efficient Home Credit is set to expire for homes sold or leased after June 30, 2026, as mandated by the One Big Beautiful Bill Act of 2025. To qualify, units must be certified and sold or leased by that date. Current credit amounts include $2,500 per unit for single-family homes certified as ENERGY STAR, and $5,000 per unit for those certified under the DOE Zero Energy Ready Home (ZERH) program. Manufactured homes meeting ENERGY STAR or ZERH standards qualify for the same respective credit amounts. For multifamily buildings built after 2020, the credit is $500 per ENERGY STAR-certified unit, or $2,500 per unit if prevailing wage requirements are met. ZERH-certified multifamily units are eligible for $1,000 each, or $5,000 per unit with prevailing wage. For homes sold or leased prior to 2020, the credit amounts are $2,000 per unit for new energy-efficient homes and $1,000 per unit for manufactured homes. With the expiration date approaching, developers should act now to secure these valuable credits....

Jul 17, 2025

The One Big Beautiful Bill Act (OBBBA) effectively ends the long-term availability of the Section 48E Clean Electricity Investment Tax Credit (ITC) by imposing hard deadlines and accelerating its phase-out. For solar and wind facilities, projects must begin construction by July 4, 2026, to remain eligible for the Section 48E credit. Projects that start construction after this date must be placed in service no later than December 31, 2027, in order to qualify. For all other qualified technologies—including energy storage—the OBBBA accelerates the general phase-out of the credit. Projects that begin construction before 2034 are eligible for 100% of the credit. Projects starting in 2034 qualify for 75%, and those beginning in 2035 receive 50%. No credit is available for projects in 2036 or later....

Jul 16, 2025

The §179D tax deduction for energy-efficient commercial buildings will no longer apply to construction projects after June 30, 2026. To qualify for the §179D deduction, construction must begin before June 30, 2026, as mandated by the One Big Beautiful Bill Act of 2025. The current deduction amount for buildings placed in service in 2025 is set at $5.81 per square foot when the project meets or is exempt from prevailing wage and apprenticeship (PWA) requirements. Deduction amounts will continue to increase annually based on inflation adjustments through June 30, 2026. The deduction may still be immediately claimed in the year the property is placed in service....

Jul 9, 2025

The One Big Beautiful Bill Act introduces key updates to the §45X Advanced Manufacturing Credit, including new domestic-content rules, accelerated phase-outs for wind and metallurgical coal, and restrictions on foreign-entity involvement. Solar, battery, and critical mineral producers still benefit, but strategic planning is now essential....

May 30, 2025

The House of Representatives passed a sweeping Republican-backed bill that would eliminate the 30% residential solar tax credit (§25D of the U.S. Tax Code) by the end of 2025. The legislation, which also includes major tax, budget, and immigration reforms, faces an uncertain future as it heads to the Senate, where bipartisan support for clean energy incentives could complicate its path forward....

May 14, 2025

The §45L Tax Credit and EnergyStar are currently intertwined. Losing one jeopardizes the other, significantly impacting our ability to build energy-efficient homes. The §45L credit is crucial for our industry's financial viability and environmental progress. Losing EnergyStar would severely hinder our ability to build sustainable housing. The §45L Tax Credit is our country’s last remaining federal incentive for residential builders....

Mar 31, 2025

The IRS has updated its Practice Unit on the §179D Energy Efficient Commercial Buildings Deduction. While not official guidance, these units provide valuable insights into IRS audit and enforcement approaches. The latest §179D updates introduce new eligibility rules, compliance requirements, and higher deduction limits. Given the complexity of these provisions, non-compliance can increase audit risks. Engaging qualified tax professionals and engineers is crucial to ensuring compliance and maximizing deductions....

Jun 21, 2024

The IRS released final regulations and related guidance regarding bonus credits and deductions for taxpayers that satisfy prevailing wage and apprenticeship (PWA) requirements. The regulations apply to certain “green” energy tax provisions, such as the §179D Energy Efficient Commercial Building Deduction and the §45L Energy Efficient Home Credit, as well as others like the §48 Energy Investment Credit, which were modified or enacted by the Inflation Reduction Act of 2022....

May 23, 2024

The IRS recently released Announcement 2024-24, notifying taxpayers that Reference Standard 90.1-2022 is the applicable reference standard required under the §179D Energy Efficient Commercial Building Deduction for ‘Energy Efficient Commercial Building Property’ (EECBP) placed in service after December 31, 2028, and the construction of which did not begin by December 31, 2022....