News: Ask the Professional - Energy Efficiency Tax Benefits

For Immediate Release:
May 14, 2010
Contact:
Brenda Jemmott, Tax Manager
(510) 893-6908
bjemmott@rina.com

Who gets the tax benefits from making a building energy efficient?

Generally, the person who makes the expenditures for construction gets the benefit. However, in the case of government-owned buildings, the deduction may be taken by the building or system designer, such as the architect or engineer.

The law allows a tax deduction up to $1.80 per square foot for a 50% or greater reduction in energy costs. There is a reduced deduction available of $0.60 per square foot which it is much easier to qualify. The owner (or designer) is eligible for the reduced deduction if they project the building’s annual energy cost savings in one of the following three categories: 10% energy savings by using a building envelope, 20% energy reduction for lighting or a 20% reduction in heating and cooling costs.

To qualify for the deduction, the building or improvements must be certified by a qualified individual.