Our Services : IRS Builders Tax Credit

The home qualifies for the credit if:

• It is located in the United States;  
• Its construction is substantially completed after August 8, 2005;
• It meets the energy saving requirements outlined in the statute; and
• It is acquired from the eligible contractor after December 31, 2005, and before January 1, 2010, for use as a residence.

Energy Saving Requirements  
Site-built homes qualify for a $2,000 credit if they are certified to reduce heating and cooling energy consumption by 50% relative to the International Energy Conservation Code standard and meet minimum efficiency standards established by the Department of Energy. Building envelope component improvements must account for at least one-fifth of the reduction in energy consumption.  
 
Manufactured homes qualify for a $2,000 credit if they conform to Federal Manufactured Home Construction and Safety Standards and meet the energy savings requirements of site-built homes described above.  
 
Manufactured homes qualify for a $1,000 credit if they conform to Federal Manufactured Home Construction and Safety Standards and reduce energy consumption by 30% relative to the International Energy Conservation Code standard. In this case, building envelope component improvements must account for at least one-third of the reduction in energy consumption. Alternatively, manufactured homes qualify if they meet Energy Star Labeled Homes requirements.

Certification  
The Internal Revenue Service (IRS) has issued guidance to provide information about the certification process that a builder must complete to qualify for the credit. The guidance also provides for a public list of software programs that may be used in calculating energy consumption for purposes of obtaining a certification.  
 
IRS Notice 2006-27 provides guidance for the credit for building energy-efficient homes other than manufactured homes. IRS Notice 2006-28 provides guidance for the credit for building energy-efficient manufactured homes. Click here to access IRS Form 8908: Energy Efficient Home Credit.  
 
For more information on this and other energy efficiency tax credits, visit the ENERGY STAR website.

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