Why We’re Watching the EPAct Tax Code 179D Incentive

Jolene Fenn-Jansen

We’re used to looking in a lot of different places for incentive money, and leave no couch cushion unturned—even when the couch belongs to Uncle Sam.

IRS energy efficiency tax deduction
Important to many EMC customers is Internal Revenue Code section 179D. This commercial building energy efficiency tax deduction was first enacted by the Energy Policy Act of 2005 (EPAct).

As a result, commercial building owners could claim a tax deduction up to $1.80 per square foot for their interior lighting projects and other energy efficiency measures that reduced a certain percentage of power cost as well as lighting power density.

These deductions were available to be taken in the year which the systems and buildings were placed into service from January 1, 2006 through December 31, 2017.

This looked like a done deal, but it wasn’t.

On February 9, 2018, the Bipartisan Budget Act of 2018 was signed into law, extending the 179D deduction from December 31, 2016 to December 31, 2017. This meant that businesses could retroactively claim the tax deduction for installing qualifying energy efficiency systems for 2017.

Once again, it’s expired. However, EMC is keeping a watchful eye on Congress’ 2019 session to see if 179D will be extended for 2018. This deduction can make a significant impact on a company’s bottom line and reduces the return on investment for a lighting project even more.

EMC will do the heavy lifting
Should the 179D deduction be extended, EMC’s professional Incentives Team will prepare the reports for IRS filing for an agreed upon fee so that your business can capture every possible incentive dollar for your lighting projects.

Jolene Fenn-Jansen is Energy Management Collaborative's Manager of Customer Incentives. In this role she utilizes her knowledge of incentive programs nationwide to expedite the application process and secure maximum incentive dollars for EMC customers.