Section 45L Energy Credits – What Qualifies?

What Construction Qualifies for the Section 45L Energy Tax Credit?

The energy tax credit for residential construction is a very valuable tax credit for developers and builders of single and multi-family homes and apartments in the U.S. This credit incentivizes using energy efficient construction and materials relative to the 2006 energy code and provides a $2000 per unit tax credit for each qualified unit (for example, if there are 100 units in a large apartment complex that qualify, the developer gets $200,000 dollar for dollar tax credit on their return). The energy tax credit applies if the following are met:

  • Construction of Apartments, Condos, Single Family Homes, Townhomes that are three  stories or less (podium style for example of three stories or less qualifies)
  • $2000 tax credit per unit (per apartment unit for example) – if modeling software shows that the energy efficiency of the unit is at least 50 % more energy efficient than the 2004 Energy Code (2006 IECC for projects placed in service in 2012 or 2013)
  • We review items such as HVAC SEER factors, energy efficient lighting, window U-Factors, Insulation R-Factors, overall building envelope and other factors that are important in this calculation for qualification.

The modeling via the software is the first step in qualification – we will conduct this phase I at no cost so give us a call today to find out if you have units that qualify. 


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