Feb 09, 2018 Trump Signs Spending Deal, Extends §179D Commercial and §45L Residential Energy Efficiency Incentives

 

by:

Alex Bagne, JD, CPA, MBA, CCSP – President of ICS Tax, LLC

On Friday, February 9, President Trump signed The Bipartisan Budget Act of 2018, which is a massive budget package that lifts spending caps while funding the government through March 23, 2018. Part of the Act retroactively extends the §179D Energy Efficient Commercial Building Deduction as well as the §45L Energy Efficient Home Credit.

Background

179D Energy Efficient Commercial Building Deduction allows taxpayers who constructed new buildings or made improvements to existing ones between 2006 and 2016 can take an immediate deduction of up to $1.80/SF for investments in efficient lighting systems, HVAC and hot water systems, and the building envelope. For architects, engineers, and contractors who design public buildings, a special rule allows them to take the deduction for themselves. As a companion tax incentive but for residential properties, the §45L Energy Efficient Home Credit allows eligible developers to claim a $2,000 tax credit for each newly constructed or substantially reconstructed qualifying residence. Both of these incentives expired as of December 31, 2016.

THE BIPARTISAN BUDGET ACT OF 2018

This Act retroactively extends both the §179D Deduction and the §45L credit through December 31, 2017. The Act makes no other changes to these incentives and preserves the baselines used to determine if a particular building or residence qualifies.

NOW IS THE TIME TO ACT

Out of all the buildings and residences that qualify for these hugely beneficial incentives, very few taxpayers are taking the steps necessary to claim them. ICS can provide a free analysis to determine if either of these incentives are feasible, and if so, provide the necessary energy modeling, third-party certifications, and other assistance to benefit from them. For a free consultation, please contact an ICS Tax representative.

ABOUT ICS TAX, LLC

ICS Tax, LLC (ICS) is a consulting firm providing innovative tax planning strategies. ICS collaborates with taxpayers and their tax professionals to identify credits and incentives that reduce tax liabilities and increase profitability. ICS provides nationwide service through its offices located throughout the country.