In June, the Internal Revenue Service (IRS) gave commercial
building owners another reason to shift to energy-efficient
building components: tax deductions enacted as a result of the
Energy Policy Act of 2005.
In its advance copy of Notice 2006-52, "Deduction for
Energy-Efficient Commercial Buildings," the IRS says commercial
building owners can deduct as much as $1.80 per square foot of
building floor area for buildings that achieve a 50 percent energy
savings target. However, even buildings that fall below the 50
percent benchmark may qualify for deductions up to 60 cents per
square foot. Properties receiving the deduction must be in service
after Dec. 31, 2005, and before Jan. 1, 2008.
Building components that can qualify a building for the tax
deduction are interior lighting systems; heating, cooling and
ventilating systems; hot water systems; and the building
Owners seeking to claim deductions must obtain certification
provided by a qualified individual, such as a licensed engineer or
contractor in the jurisdiction where the building is located.
Furthermore, the energy savings calculated by the qualified
individual must be calculated using software approved by the...
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