An issue NAED has been fighting for years may finally come to an end, thanks to the proposed COVID-19 stimulus package that Congress will vote on Monday, December 21.
The Commercial Buildings Tax Deduction, known as Section 179D, allows for a yearly deduction for the use of energy efficient products, including LED lighting. According to the Department of Energy website, “The 179D commercial buildings energy efficiency tax deduction primarily enables building owners to claim a tax deduction for installing qualifying systems and buildings.”
Like past years, the deduction was scheduled to expire on December 31. In fact, Section 179D faced a yearly battle, which usually ended with a one-year extension, followed by other battles for yearly extensions every December.
However, the stimulus package expected to pass Congress and signed by President Trump will make the Commercial Buildings Tax Deduction permanent.
The Department of Energy website explains in detail how the tax deduction works, saying, “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.” Buildings will fully qualify for the deduction if the lighting can reduce energy use by 50% or more.