Section 45L Tax Credits

45L Tax Credit

IRC Section 45L Tax Credit

The federal Energy Efficient New Homes Tax Credit (Section 45L) applies to single family and multi-family dwelling units (three stories or less) that were sold or leased between January 1, 2012 and December 31, 2016. Specifically, if any of these dwellings exceeded the 2006 Edition of the International Energy Conservation Code (IECC) heating and cooling budgets by 50%, they are eligible for a $2,000 tax credit. Even if you have already tried and failed to qualify you may still qualify.  We can look at your property and see if there's any options available to qualify for the tax credit.

For the last 11 years this credit had been available.  Even during years when it was technically unavailable it eventually has three times now been renewed and made available retroactively so you don't lose the credit. It is currently unavailable. But, word on the street is this credit will be renewed for 2017.

The Energy Efficient Home Credit offers a tax credit of $2,000 per dwelling unit to owners of energy efficient apartment buildings and homes that were built between January 1, 2012 and December 31, 2016. The upside for this credit is reauthorized every year or two with the reauthorization date being made retroactive back to the last expiration date. Since 2005 the credit has been in full force and effect even though it has expired several times in the past. Even Trump cannot stop this tax credit from by reauthorized.  The tax code is 26 U.S. Code § 45L - New Energy Efficient Home Credit

What are the requirements?

  • Units must be at least 50% above the 2006 Intl Energy Conservation Code (IECC).   Title 24 is significantly more stringent than the ’06 IECC, therefore making the 45L tax credit very accessible to CA builders.
  • Features verified by certified HERS rater
  • Register the 45L certificates in an approved HERS registry for quality assurance
  • Units completed & sold or leased/rented between Jan. 1, 2012 - Dec. 31, 2016. 

Who Is Eligible - Apartment Buildings & Condos

A dwelling unit should provide a level of heating and cooling energy consumption that is significantly less than certain national energy standards, dependent on when the unit is sold or leased. Based on current construction trends, many developments already exceed these standards. Given that current energy codes have evolved tremendously over the past five years, many developers are already building to specifications that would meet the criteria for this credit. All apartment buildings and residential condominium developments completed within the last 4 years are worth assessing for potential 45L tax credits. Eligible construction also includes substantial reconstruction and rehabilitation. Developers can still claim the 45L tax credit retroactively if they did not claim them on previous tax returns.

The Process

The basis for developing and supporting the 45L tax credit is a detailed energy analysis that must be certified by a qualified third-party. Our energy consultants will ensure that you obtain the maximum tax credits and provide all the documentation necessary to sustain an IRS audit. We use only IRS approved software programs for the IRC Sec. 45L certification.

Peace of Mind

The basis for developing and supporting the 45L tax credit is a detailed energy analysis that must be certified by a qualified third-party. What sets Apollo Energies apart from all the other consultants and engineers certifying the tax credits is during our site visits we will actually conduct some necessary testing to confirm and support the assertions used to qualify your property. The current statute does not require tests to be conducted. They only require someone to visually inspect the measures installed which were used to qualify the property for the credit are actually present. The reason this is important is some of the measurements that are modeled are best guestimates. Some measurements could be a make or break in terms of qualifying. This leaves the resultant certification open to interpretation. When an auditor is looking for anything to justify their assumptions you’ve been less than honest in your reporting, focusing in on this tax credit gives them the open they’ll need to question other aspects of your return? By conducting certain tests used to measure efficiency we can insure, and will stand behind, any auditing of the tax credit certifications we issue.

45L Tax Credit Benefits

  • 30 qualified units = $60,000 in 45L tax credits
  • 60 qualified units = $120,000 in 45L tax credits
  • 100 qualified units = $200,000 in 45L tax credits
  • 200 qualified units = $400,000 in 45L tax credits
  • 500 qualified units = $1,000,000 in 45L tax credits
  • 1000 qualified units = $2,000,000 in 45L tax credits

Get Started Today

We offer a complimentary feasibility assessment that will illustrate how you can benefit from the 45L tax credit. To find out more or to get started on a feasibility assessment contact us at 888-614-8338 or email sales [AT] apolloenergiesinc [DOT] com.  

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