Tax policy in the commercial built environment can be a needed incentive to motivate energy efficiency investments. Changes made in the IRA to the permanent 179D tax deduction expand the deduction’s reach and increase the amount available when meeting identified requirements. Components of the new 179D include:
- Base Deduction: $.50 - $1.00 per sq ft.
- Bonus Deduction: $2.50 - $5.00 per sq ft. when meeting prevailing wage and apprenticeship requirements.
- Energy and Power Reductions: 25% or more.
- Alternative: Energy Use Intensity.
- Real Estate Investment Trusts (RIETs) are included.
- Non-Profits/Government may assign the allocation.