Tax deductions for energy efficient improvements available to contractors


The General Services Administration (GSA) issued a reminder that the Energy Efficient Commercial Building Tax Deduction for government-owned buildings can be allocated to those who are responsible for the design, creating an incentive for contractors to exceed energy reduction requirements.

The deduction was authorized by the Energy Policy Act of 2005 and was extended through Dec. 31, 2013 by the Emergency Economic Stabilization Act of 2008. Contractors that wish to take advantage of the allocation of the deduction can submit a request to the agency that owns the building.

The Energy Policy Act provides a tax deduction for the cost of improvements that reduce energy and power expenses by at least 50 percent above the Energy Standard for Buildings Except Low-Rise Residential Buildings (ASHRAE 90.1) up to a maximum of $1.80 per square foot. A partial deduction of up to 60 cents per square foot is also available for improvements that don’t meet the 50 percent cost reduction threshold.
For more information on this deduction, visit the GSA website Here.


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