Deciding to use Green building technologies in the construction of a new house has become easier and more economically feasible in recent years. Commercial construction has benefited from recognition and economic incentives for building to LEED standards (Leadership in Energy and Environmental Design) for years. While LEED certifications for residential construction brought recognition and tax incentives to the Builder, it simply delivered the satisfaction of doing the right thing to the homeowner. Now, with recent legislation, Homeowners can benefit from Tax Credits and rebates for Going Green, as well.
New resources for Tax Credits and Rebates
One of the purposes of the Inflation Reduction Act of 2022, which was signed into law on 08/16/22, is to help incentivize the construction of more energy-efficient buildings. Along with updates to previously passed legislation for Commercial construction, it includes the 45L home tax credit – an update to further incentivize building more Energy Star-rated homes. Different from a LEED certification, an Energy Star Rating focuses on energy efficiency through the use of rated building products and systems. Builders of Homes with an Energy Star Certification will be eligible for a tax credit on each qualified house. Homeowners will be eligible for tax credits and rebates for the purchase and installation of Energy Star-rated products, systems, and equipment.
You can also look for updated credits and rebates for the electrification of homes, that encourage clean-energy use, including Small Wind Turbines and Solar Arrays. For qualified homeowners, HEEHRA (High-Efficiency Electric Homes and Rebates Act) will create point-of-sale rebates for electrification projects and equipment. To further encourage the use of clean and renewable energy sources, the EPA has developed RERH specifications (Renewable Energy Ready Homes), to guide the construction of new homes that are ready for the installation of a complete Renewable Energy System. This will help to educate Builders and streamline the process. So, homeowners now have more choices and fewer roadblocks to Going Green for energy efficiency.
Consult a Tax Specialist
The alphabet soup of Acts, agencies, and rating systems can be confusing to navigate, so consulting with a Tax Specialist should be part of the process. But it’s good to know that there are resources that homeowners can use, and tax credits that they can qualify for, to help them go green when building their homes. And, it is good to see that the government is working to put better energy efficiency and sustainability in reach for more people.