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Tax incentives and deductions are not only available for commercial buildings, but can be received by home developers as well. This helps many developers building affordable housing and will ensure that any and all occupants will be safe from toxins found in many old homes. Qualifying for the 45L tax incentive is not difficult and will have more benefits than just a tax break. This blog is going to explore what the energy efficient tax incentive, or 45L, can do and who can qualify, as well as other benefits people can receive.
What is the 45L Tax Incentive?
This incentive is for developers and investors of affordable housing, which can save them thousands of dollars per property. The amount of money saved will change in the coming year and it is important for all developers to make sure they keep an eye on any tax changes. Last year (2013), developers and investors of affordable housing developments could save up to $2000, which was a big help to many building homes in a tough economy. It has many benefits, which will be talked about later in this article.
Qualifying for an Energy Efficient Tax Incentive
This incentive applies to detached dwellings, townhouses, or apartment buildings and can be claimed by the unit owner within the tax-year. If the owner has apartment buildings, the tax incentive will include each apartment unit and the buildings must meet EPA standards.The unit must have 50% less energy consumption when compared to similar dwellings to qualify. An engineer will inspect the unit to ensure it is up to the EPA regulations in order to qualify for the 45L energy efficient tax incentive.
Multiple Benefits
An affordable housing dwelling that meets the standards of the energy efficient tax incentive for homes will have many benefits. A home may provide more equity for the dwelling owners for Low-income Housing Tax Credit (LIHTC) projects. Developers will receive many tax benefits, as well after a housing unit has been built and is ready for occupants. This tax incentive will also provide developers or investors with the possibility of a short time partnership, helping them to avoid any losses by lessening the equity of the project.
Key Things To Remember
Before attempting to qualify for the 45L tax incentive, developers and investors must make sure the costs of the material will not be too expensive. If the materials are more expensive than the initial project, the tax benefits may not be enough to make up the difference. It is good to have a set budget in mind and then research the materials needed.
In Closing
Claris Energy understands that qualifying and researching the 45L energy efficient tax incentives for homes can be overwhelming. Claris Energy is a company that will help developers and investors work through the process of the 45L tax incentive, ensuring they qualify or help them find alternative methods that will work best for them. Contact Claris Energy today to learn more.
Steve Nanos
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