Agency: Department of the Treasury
Description:
Tax deduction of for the cost of energy efficient commercial building property, calculated by the size of the building.
Bill Section:
13303
US Code:
26 USC 179D
New or Existing:
Existing
Potential Cost:
$362,000,000
Timeline:
Property placed in service in 2023 and after
Implementation Status/Rulemaking:
More information on the Energy efficient commercial buildings deduction Source
TCS Notes:
Available to owners of commercial buildings, certain governmental entities, Indian tribal governments, Alaska Native Corporations, and other tax-exempt organizations. Eligible technology must improve the interior lighting systems; the heating, cooling, ventilation, and hot water systems; or the building envelope. Improvements must reduce overall energy costs by at least 25%.
For properties put in service starting in 2023, the deduction is calculated by multiplying the square footage of the building by 50 cents. This base rate is increased $0.02 for each 1% the annual energy costs are reduced up to a total credit of $1.00 per square foot. If certain wage and apprenticeship measures are followed, the final rate can increase to as much as five times its previous calculation (topping out at up to $5.00 per square foot).