Energy Efficiency & Sustainability Consulting

Energy Efficiency Could Save You Big Money on Your Taxes

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Many building owners are finding that there are big benefits to installing energy efficiency measures in their commercial buildings beyond the financial savings listed on their energy bills every month. Many building owners are finding that there are big benefits to installing energy efficiency measures in their commercial buildings well beyond the financial savings listed on their energy bills each month.

In 2006, the Energy Efficient Commercial Buildings Deduction, or Section 179D, became available to taxpayers. This tax incentive allowed immediate deductions of up to $1.80 per square foot for energy efficient improvements meeting a predefined standard. Section 179D tax deductions apply to all qualifying updates completed between January 1, 2006 and December 31, 2014.

Partial deductions are available for lighting, HVAC and building envelope improvements at $0.60 per square foot per category. To qualify for partial deductions, energy costs must be reduced by 25% for lighting, 15% for HVAC and 10% for building envelope.

What Qualifies?

  • Commercial buildings
  • Residential multi-family buildings that are at least four stories high
  • Converted buildings that are now classified as commercial buildings
  • Buildings that are used for industrial purposes
  • Government buildings

How Do I Qualify? Owners qualify for tax deductions if…

  • Improvements exceed the requirements of 2001 ASHRAE 90.1 by predetermined amounts.
  • An independent agency or third party engineer has certified that the implemented improvements meet the criteria.

The larger the building, the better your chances of receiving the maximum allowable deduction.

Don’t give all your money to Uncle Sam! Reap all of the benefits from your energy efficiency improvements. Click here to find out how EES Consulting can help you with a 179D tax deduction!