179D Energy Tax Certifications
What is the 179D Tax Deduction?
The 179D Energy Tax Deduction is a very specific deduction allowed for energy efficient commercial buildings that was enacted as part of the Energy Policy Act of 2005. The engineered based tax incentive is available for the reduction of energy and power costs in commercial buildings and allows for a tax deduction of up to $1.80 per square foot.
The 179D Tax Deduction specifically applies to those commercial buildings that significantly reduce their interior lighting costs or their HVAC and building envelope.
The deduction may be claimed for new construction or improvements placed into service after Jan. 1, 2006, for commercial building owners (a Change in Accounting Method may be used to retroactively take the deductions). Designers of government-owned buildings are able to take the 179D deduction for all “open” tax years, which generally allows 3 years from the date of filing (buildings placed in service earlier than that require an amended return).
WHAT BUILDINGS QUALIFY?
WHO CAN BENEFIT?
savings per square foot of improved space
Section 179D requires the taxpayers building to meet or exceed a 50% savings in energy and power costs when compared to a theoretical ASHRAE 90.1-2007 baseline building.
Even if you don’t meet or exceed the 50% baseline savings in energy and power costs, your building may still be eligible for partial tax savings.
for lighting systems meeting 25% savings
for HVAC systems meeting 15% savings
for building envelope systems meeting 10% savings
Frequently Asked Questions about Research Tax Credits
DOES MY TAX PREPARER ALREADY DO THIS?
Do I HAVE TO GET A CERTIFICATION TO TAKE THE DEDUCTION?
DOES IT MATTER WHEN I TAKE THE 179D DEDUCTION?
WHAT IF I DIDN'T TAKE THE DEDUCTION THE YEAR THE BUILDING WAS FINISHED?
HOW MUCH DOES IT COST AND HOW MUCH WILL I SAVE?
HOW DO I GET STARTED?
Ready to get started?
Veracity’s personnel have years of experience in understanding 179D and how it can benefit taxpayers. Our energy modelers have modeled hundreds of buildings using IRS approved software.
Our principals have spent years educating the CPA and design communities about the benefits of Section 179D. No other company has more experience dealing with the ins and outs of 179D than Veracity.
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