Our Services
Section 179D
Federal tax deductions for building owners and design firms
based on energy efficient building design
Highlights
- Comprehensive Documentation that stands up to IRS scrutiny
- Simple Fixed Fee Structure
- Subject Matter Experts work directly with you and your tax professionals to quantify and substantiate 179D deductions
- Expert Team includes Engineers, Tax Attorneys, CPAs, IRS Enrolled Agents, LEED APs
- 17000 + studies completed throughout the country, even Guam
- Over $1B in Federal 179D Tax Deductions Processed
- 179D studies completed on over 1.5 billion square feet of building space
Energy Tax Savers is the first green tax firm, we help our clients achieve federal tax incentives aimed at making energy efficient investment as economically viable as possible. We know how to apply the tax law to make building energy efficiency even more profitable.
We represent many of the nation’s leading retailers, warehouse owners, aerospace companies, industrial manufacturers, financial service firms and car dealers. We also represent numerous architecture, engineering, ESCOs, design & build firms, and lighting designers.
Section 179D Overview
The Section 179D Deduction (“EPAct 179D”) was enacted creating immediate tax savings for building owners and design firms based on the use of energy efficient building design such as lighting, HVAC, building envelope, and building controls.
- Since its inception in 2005, the tax deduction has been permanently extended
- Projects completed between January 2006 – present are eligible
- Both new construction or building retrofits can benefit from the EPAct Section 179D deduction
- The Section 179D Deduction can now be taken multiple times during a building’s lifetime
Recent Updates Under the Inflation Reduction Act
In 2022, The Inflation Reduction Act (IRA) was signed into law which has significantly expanded Section 179D tax savings opportunities.
- The Section 179D Deduction can be taken multiple times in a project’s lifetime
- The available tax deduction has increased to over $5.00 per square foot
- 179D Deductions now available for tribal government and non-profit buildings
The value of the Federal tax deduction is based on project square footage
For projects placed in service in 2022 or prior:
EPAct provides a deduction of up to $1.88 per square foot for the installation of systems that reduce energy and power consumption by 50% in comparison to a standard building (ASHRAE Standard 90.1)
For projects placed in service in 2023 or later:
EPAct provides a maximum potential tax deduction of up to $5.81 per square foot for installation of systems that reduce energy and power consumption by 25% in comparison to a standard building (ASHRAE Standard 90.1)
Who Qualifies for the 179D Tax Deduction?
Building Owners & Developers
Commercial building owners can obtain 179D tax deductions for their energy efficiency projects dating back to 2006. Eligible building types include:
Industrial
Parking Garages
Retail
Office
Hotel
Hospital
Apartments (4 stories or greater)
Distribution Centers & Warehouses
Sports Arenas & Gyms
Designers
In addition to building owners, the Section 179D deduction can also be claimed by primary designers such as architects, engineers, and contractors for public, government, and nonprofit buildings. Examples of these eligible building types include:
Federal Government Buildings – Military Bases, Courthouses, Post Offices, Labs, Offices
State Government Buildings – Public Universities, Courthouses, Offices, Hospitals, Airports
Municipal Government Buildings – K-12 Public Schools, Town Halls, Police and Fire Stations, Libraries
Non-profit Buildings – Private Schools and Universities, Hospitals, Religious Institutions, Museums, Community Centers
Tribal Governments – Community Centers, Police and Fire Stations, Hospitals, Schools, Hospitality
What is a Designer?
Per IRS Notice 2008-40, a designer is “a person that creates the technical specifications for installation” of lighting, HVAC, or building envelope in a building owned by a government or specified tax-exempt entity.
A designer may be any of the following, if eligible activities are performed:
Architect
Engineer
Contractor
Environmental Consultant
Energy Services Provider
In the case of buildings owned by governments and tax-exempt entities, the owner of the building may allocate the Section 179D deduction to the designer or designer(s).
In addition to energy projects completed in the current tax year, designers can typically claim Section 179D deductions for projects completed in the preceding three years.
How to Qualify for the Tax Deduction
Eligible projects include installations related to lighting, HVAC, building envelope, and building controls.
The process of qualifying projects for the EPAct Section 179D deductions requires a detailed engineering analysis of building energy usage.
Our tax experts and engineers perform in-depth energy modeling and energy use intensity (EUI) calculations.
We leverage DOE approved modeling software to simulate building energy consumption and evaluate the project against threshold requirements for efficiency.
Prevailing Wage & Apprenticeship Requirements
Increased 179D deduction levels are available for projects that satisfy prevailing wage and apprenticeship requirements during construction. These requirements are generally based on those set forth in Section 45 of the tax code and are applied to other sections, including Section 179D.
Typically Eligible Projects
- Lighting Installation
- Roof Installation
- Window Installation
- Lighting or HVAC Controls Installation
- HVAC Installation
- Geothermal (Ground Source Heat Pumps)
- High Efficiency Water Source Heat Pumps
- Thermal Storage
- High Efficiency VRF units in Rental Apartments/Dorms/Hotels
- Centralized HVAC in Rental Apartments/Dorms/Hotels
- Energy Recovery Ventilation
- Demand Control Ventilation
- VFD’s on all major Motors and Compressors
- Chillers in buildings < 150,000 sq ft
- Direct fired heaters in no AC Industrial Spaces
- Industrial Space >75,000sq ft with Constant Volume Package unit
- VAV (variable air volume devices) in buildings <75,000 sq ft
- Chilled Beam
- McQuay Magnetic Bearing Chillers
- Smardt Chillers
- Arctic Cool Chillers
- Gas fired chillers combined with electric chillers to peak shave
- Coolorado in dry climates
- Combined Heat and Power
Our Value Added Deliverables
- Complimentary 179D Estimate
- Turn-Key Review & Analysis
- Simple, Fixed Fee Structure
- All necessary tax forms and guidance for Section 179D filing
- Comprehensive Study to substantiate the tax deductions and eligible projects
- Audit Support
- Reports from DOE Approved Software
Our team provides unparalleled expertise in order to substantiate the maximum Section179D deductions and ensure its defense. We perform complimentary assessments to estimate your project’s tax deduction as well as provide you with a fixed fee quote.
179D Tax Deduction Insights
Section 179D Frequently Asked Questions
Answers to common questions about Section 179D tax deductions such as qualifying building technologies and tax deduction levels.
Case Studies
Section 179D success stories that highlight the tax deductions awarded for various building types.
Featured 179D Publications
Explore our publications and articles on how to leverage Section 179D tax deductions for a variety of building projects.
Estimate Your Tax Deduction
Calculate the potential 179D tax deduction for your project. Our Section 179D Estimator Tool provides a potential tax deduction range based on your project details.
Wondering if Your Project Qualifies?
Discover your tax savings with a complimentary Section 179D assessment from our team of experts.
No two cases are the same, which is why we take an individualized approach.
Speak with one of our tax experts today.
Charles R. Goulding
President
Charles R. Goulding is an Attorney/CPA, President and founder of Energy Tax Savers/R&D Tax Savers, two divisions of a national tax consulting firm. Previously, he was a Managing Director at Cooper Industries Inc. (now Eaton) in Houston, Texas. Before joining Cooper, Mr. Goulding was a vice president of Dover Corporation, an eight billion dollar sales NYSE diversified industrial manufacturer. At both companies, Mr. Goulding created and administered company-wide R&D Tax Credit programs. These programs encompassed both domestic and international business operations and have helped generate over $600 million in tax savings for their respective firms. Mr. Goulding has been at the forefront of R&D Tax Credit work since the credit’s inception in 1981.
Mr. Goulding has a law degree from Brooklyn Law School (Juris Doctor) and an MBA from Adelphi University. Mr. Goulding also participated in Pace University’s Doctor of Business Administration Program. His undergraduate degree is from the State University of New York at Stony Brook where he was a double major in Political Science and Economics. He spent his junior year abroad at the University of Copenhagen, Denmark.
Mr. Goulding is a former President of the New York Chapter of the Tax Executives Institute and also participated in Pace University’s Doctor of Business Administration Program. He has served as the co-chairman of the Taxation of Mergers and Acquisition conferences in Chicago, Houston, New York City, San Francisco and Paris, France. He recently chaired New York’s Solar Investment Conference.
He has authored over 800 articles for numerous tax publications including International Business, International Tax Journal, Euromoney, Taxation for Accountants, The Practical Accountant, The CPA Journal, and Corporate Business Taxation Monthly.
Mr. Goulding successfully litigated the Dover Corporation case in U.S. Tax Court (the first check the box case) and the Pulsar International case on reasonable compensation. He is also the Mayor of the Village of Oyster Bay Cove, New York