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What is 179D?

  • By Cedric James
    • Oct 27, 2023
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What is the 179D Energy Efficient Commercial Building Property Tax Deduction?

The Energy Efficient Commercial Building Tax Deduction, or §179D, was signed into law by President George W. Bush as part of the Energy Policy Act of 2005. This enabled commercial building owners to claim a tax deduction if they install energy efficient equipment into their buildings.

Many commercial buildings, which were tax exempt, initially underutilized the intended purpose despite it being a great idea. In response, IRS Special Notice 2008-40 ratified the legislation to include government owned commercial buildings.

The Inflation Reduction Act of 2022 further expanded this legislation to include buildings owned by tribal governments, Alaska Native Corporations, and tax-exempt organizations. The aim of this legislation was to decrease our nation’s energy consumption while simultaneously stimulating the American economy.

Monetary Benefit of §179D

  • Up to $5.00 per sq/ft of the building

Who Qualifies for the §179D Tax Deduction?

  • Architects, Engineers, Contractor, Environmental Consultants, or Energy Service Providers
  • Commercial Building Owners
  • Real Estate Investment Trusts (REITs)

Types of Buildings

  • Tax-Exempt Buildings: Schools, Universities, Libraries, Local Municipalities, Recreational Centers, Hospitals, Military Bases, 501(c)(3), Tribal Land, Churches, Etc.
  • Taxable Buildings: High Rise Residential, and all Commercial Buildings

Types of Projects

  • New Construction
  • Renovation
  • Additions

This incentive requires a third party to certify the results, which is where companies like ours showcase our expertise. Leyton is an international consulting firm that helps businesses leverage financial incentives to accelerate their growth and achieve long-lasting performance.

We never outsource any part of your §179D study. Positioning us as the highest quality option at a very competitive rate.


Cedric James

Energy Efficiency Consultant

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