The 179D commercial buildings energy efficiency tax deduction primarily enables building owners to claim a tax deduction for installing qualifying systems and buildings. Tenants may be eligible if they make construction expenditures. If the system or building is installed on federal, state, or local government property, the 179D tax deduction may be taken by the person primarily responsible for the system’s design. The systems and buildings must have been placed in service by December 31, 2020, which is when 179D expires. Deductions are taken in the year in which systems and buildings are placed in service. The 179D tax deduction has been in effect since January 1, 2006.
$1.80 sq.ft. for installation of interior lighting, building envelope, heating, cooling, ventilation, or hot water systems that reduce the buildings total energy and power cost by 50%
Deductions up to $0.60 per square foot are available to owners of buildings in which individual lighting, building envelope, or heating and cooling systems that partially qualify be meeting certain target levels or through the interim lighting rule. These three compliance pathways are shown in the table below.
NJ Department of Environmental Protection (DEP)