Tax Credits for Home Builders
Federal Tax Credits for Builders of Energy Efficient Homes
As part of the recently passed Inflation Reduction Act, the Section 45L Tax Credit for Energy Efficient New Homes has been updated and extended. For homes and units acquired on or after January 1, 2023, the base-level tax credit is specifically tied to meeting ENERGY STAR program requirements for single-family, manufactured, and multifamily homes, and the tax credit has been extended through 2032. The IRS has posted information about Form 8908 - Energy Efficient Home Credit including how eligible entities can claim the credits described below.
- Single-Family New Homes - $2,500 available for meeting ENERGY STAR program requirements.
- January 1, 2023 – December 31, 2024: ENERGY STAR Single-Family New Home National Version 3.1.*
- January 1, 2025 – December 31, 2032: ENERGY STAR Single-Family New Homes National Version 3.2.*
* EPA is awaiting guidance from the IRS on the applicability of state/regional versions of the ENERGY STAR program requirements.
- Manufactured Homes - $2,500 available for meeting the most recent ENERGY STAR Manufactured New Homes program requirements.
- Multifamily - $500 available for meeting the ENERGY STAR Multifamily New Construction National program requirements (or the regional program requirements) applicable to the dwelling unit, as specified in Section 13304. A larger tax credit ($2,500) is available for multifamily projects that meet prevailing wage requirements.
A larger tax credit is available for homes that are certified to DOE’s Zero Energy Ready (ZERH) Program, which requires ENERGY STAR certification as a prerequisite.
All official information related to the tax credit will be determined and published by the IRS. The ENERGY STAR team is committed to keeping our partners informed as the IRS works to develop updated documents and guidance.