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Yes, Even more tax savings

Go green and save big: Your energy efficiency credits await

This program applies to newly constructed homes that meet specific energy efficiency standards. It provides a federal tax credit of up to $5,000 per qualified dwelling unit, encouraging the construction of energy-efficient homes.

Book a Consultation How it works

The Act provides new requirements and higher benefits for units sold or leased from January 1, 2023 through December 31, 2032.

Credit for builders of new energy-efficient homes

The §45L Energy Efficient Home Credit, part of the Energy Policy Act of 2005 and extended by the Inflation Reduction Act of 2022, offers builders and developers significant tax credits.

Why It Matters

The §45L Credit is designed to financially reward developers who prioritize energy efficiency in their construction projects. By meeting the enhanced standards, businesses can receive $2,000 to $5,000 per unit in tax credits, significantly reducing the overall tax burden. This initiative not only supports environmental sustainability but also offers financial incentives that improve the profitability of development projects.

To qualify for the §45L Energy Efficient Home Credit, developers must ensure that their projects achieve at least 50% lower heating and cooling energy consumption compared to national standards. Detailed energy modeling and third-party certifications such as ENERGY STAR or DOE Zero Energy Ready Home are required. The process includes submission of proper documentation and adherence to specific construction standards to ensure eligibility for the tax credits, which are applicable immediately and can be retroactively claimed for past projects

Requirements to maximize savings with energy efficient credits

Earn up to $5,000 in tax credits for energy efficiency depending on the type of home and the qualifying credit.

Single Family Homes

  • + $2,500 tax credit (Must be certified as ENERGY STAR)
  • + $5,000 tax credit (Must be certified as DOE Zero Energy Ready Home)

Manufactured Homes

  • + $2,500 tax credit (Must be certified as ENERGY STAR)
  • + $5,000 tax credit (Must be certified as DOE Zero Energy Ready Home)

Multifamily Homes

  • + $500 tax credit for multifamily homes constructed after 2020 and certified as ENERGY STAR.
    Bonus: When constructed with prevailing wage, the credit increases to $2,500.

  • + $1,000 tax credit for multifamily homes certified as DOE Zero Energy Ready Home.
    Bonus: When constructed with prevailing wage, the credit increases to $5,000.

Homes More Than 3 Stories

Beginning 2023, all residential buildings are eligible. Homes leased or sold as a residence within buildings higher than three stories are eligible.

  • + Low-rise: 1-4 stories
  • + Mid-rise: 5-9 stories
  • + High-rise: 10 or more stories
A Brief Example

Apartment Community Developer Maximizes Credit

We recently worked with on a development where each unit in the newly constructed apartment community qualified for the $2,000 per unit §45L Credit. With a total of 220 units in the community, the developer received a total tax credit of $440K.

What we do

We offer expert 45L assessments at no cost

Our services include:

  • + Trained and certified HERS (Home Energy Rating System) raters
  • + Review of your construction documents.
  • + Interviewing design professionals, project managers, and other relevant personnel.
  • + Performing all necessary testing and inspections.
  • + Modeling energy efficiency using IRS-approved software.
  • + Preparing certificates of compliance signed under penalties of perjury by a HERS rater.
  • + Coordinating with your tax preparer.
  • + Providing free audit support.

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