The Inflation Reduction Act (IRA) signed into law by President Biden this week includes expanded tax credits that are expected to spur building owners and developers to make energy-efficient improvements that speed the decarbonization of commercial real estate.

Under the IRA, the maximum allowable benefit for the 179D Energy Efficient Buildings Tax Deduction will expand in 2023 from $1.88 per square foot to $5.00 per SF.

For an eligible 250K SF building, a $470K deduction at the 2022 rate now potentially increases to a $1.25M deduction. To qualify, new construction projects and renovated buildings must meet specific energy-reduction requirements.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM Digital Member, you’ll receive:

  • Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Leadership & Management
National
Development
Southwest