Federal Tax Credits for Energy Efficiency

UPDATED May, 2015

Current Federal Rebate for 2015

Tax Credit Amount: 0% of the cost (there are no Federal Tax credits in effect for 2015).

Tax Credits for Home Builders:

Eligible contractors need to fill out IRS Form 8908 to get the tax credit. The IRS has provided the following guidance regarding the tax credits for constructing energy efficient new homes available under the Energy Policy Act of 2005:
IRS Notice 2006–27 provides guidance for the credit for building energy efficient homes other than manufactured homes.
IRS Notice 2006–28 provides guidance for the credit for building energy efficient manufactured homes.

Home builders are eligible for a $2,000 tax credit for a new energy efficient home that achieves 50% energy savings for heating and cooling over the 2006 International Energy Conservation Code (IECC) and supplements. At least 1/5 of the energy savings has to come from building envelope improvements. This credit also applies to contractors of manufactured homes conforming to Federal Manufactured Home Construction and Safety Standards.

There is also a $1,000 tax credit to the producer of a new manufactured home achieving 30% energy savings for heating and cooling over the 2006 IECC and supplements (at least 1/3 of the savings had to come from building envelope improvements), or a manufactured home meeting the ENERGY STAR requirements.

Please note that, with the exception of the tax credit for an ENERGY STAR certified manufactured home, these tax credits were not directly linked to ENERGY STAR. Therefore, a builder of an ENERGY STAR certified home may be eligible for a tax credit but it is not guaranteed.

These tax credits apply to new homes located in the United States whose construction is substantially completed after August 8, 2005 and that are acquired from the eligible contractor for use as a residence from January 1, 2006 through December 31, 2013.

Tax Deductions for Commercial Buildings:

A tax deduction of up to $1.80 per square foot is available to owners or designers of new or existing commercial buildings that save at least 50% of the heating and cooling energy of a building that meets ASHRAE Standard 90.1-2001. Partial deductions of up to $.60 per square foot can be taken for measures affecting any one of three building systems: the building envelope, lighting, or heating and cooling systems. These tax deductions are available for systems "placed in service" from January 1, 2006 through December 31, 2013.

For more information, please see our page titled Commercial Buildings Tax Deductions in this same Tax Credit section.

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