The real estate industry was rewarded this week with the passing of new tax legislation that extends several real estate-related tax provisions through the end of 2020, such as the section 45L tax credit for construction of new energy-efficient homes and the section 179D tax deduction for energy-efficient commercial building property. This bill also makes these tax incentives retroactive back to 2016.
Among these tax breaks are various provisions for energy-related tax credits and incentives. Key provisions impacting the multifamily industry include the following:
Section 45L Energy Efficiency Credits
Low-rise (three-story and below) apartment developers are eligible for a $2,000 tax credit for each new or rehabbed energy efficient dwelling unit that is first leased. Taxpayers also have the ability to amend returns to claim missed tax credits from previous years.
Section 179D Energy Efficiency Deductions
Tax deductions, not credits, of up to $1.80 per square foot for energy efficient multifamily projects (four-story and above) have been extended. Designers of government-owned buildings remain eligible for these deductions as well.
Ascent had been active in helping its clients take advantage of these energy tax credits. In the last 24 months, we have helped clients secure anywhere from $496,000 to more than $2.5 million in tax credits.
John Stewart, Principal at Juliet Companies said this about working with Ascent:
“Ascent approached us about Section 45L energy tax credits and offered to do a free pre-qualification. They took a quick look at our plans and determined there was a high likelihood we could get the credits. We authorized them to do a field survey and we secured a substantial amount of tax credits. It was definitely worth it to give Ascent a look!”