Turn Energy Efficiency into Savings with the 179D Deduction

There's still time to secure tax savings up to $5.00 per square foot for your commercial building projects.

What is the 179D Commercial Energy Efficiency Deduction?

The 179D tax deduction is a tax break offered by the federal government. It incentivizes building owners and designers to invest in sustainable infrastructure. Whether you are upgrading HVAC systems, installing efficient lighting, or improving your building envelope, you can deduct these costs from your taxable income.

Important deadline: The 179D tax deduction only applies to projects initiated before June 30, 2026.

The Inflation Reduction Act significantly expanded the benefits of the 179D tax deduction, making it more attractive for those investing in energy efficiency for commercial buildings.

How do projects qualify?

The energy savings threshold to qualify has lowered. Previously, your projects needed to reach 50% in energy savings to qualify. Now, you only need to achieve 25%.

Who can benefit?

You may be eligible for the 179D deduction if you are a commercial building owner, architect, engineer, or building designer, a government contractor, or a tenant making eligible improvements.

Also, the deduction is available to non-profit organizations 501(c) organizations, which can pass this deduction on to the people who design the building—like architects, engineers, or contractors.

How much money can you save?

You can get up to $5.00 for each square foot of your building, up from just $0.50. This increase depends on how much energy you save and labor practices.

Interested in exploring the benefits of the 179D Energy Efficiency Deduction?

Navigating federal tax incentives can be complex, but you don't have to do it alone. Our Energy Advisors are ready to help you understand how your project aligns with 179D requirements and our own incentive programs.

Fill out this short form to speak with an energy advisor today!

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