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26 U.S. Code § 45L

IRA Statuatory Location:

13304

Tax Code Location:

26 U.S. Code § 45L

New or Modified Provision:

Existing, but the credit had previously expired at end of 2021. Retroactively extended with new rules effective for homes acquired after 2022.

Eligible Recipients:

Homebuilders

Tribal Eligibility:

Yes

Funded by:

U.S. Department of Treasury

Description

Provides a tax credit for construction of new energy efficienthomes
Direct Pay Eligibility:
For multifamily homes, 5 times the base amount if prevailing wage requirements are met. Initial guidance on the labor provisions is available here. (https://www.federalregister.gov/documents/2022/11/30/2022-26108/prevailing-wage-and-apprenticeship-initial-guidance-under-section-45b6bii-and-other-substantially)
Transferability:
No
Stackability:
Yes. Taxpayers claiming the Low-Income Housing Tax Credit do not have toreduce basis for 45L credits claimed.
Energy Community Bonus:
No

Relevant Announcements

Related Resources

Additional information is available on the Resources page.

Key Details

Period of Availability
2023-2032
Tax Mechanism:
Tax credit for homebuilders
Base Credit Amount:
$2,500 for new homes meeting Energy Star standards; $5,000 forcertified zero-energy ready homes. For multifamily, base amounts are $500 per unit for EnergyStar and $1000 per unit for zero-energy ready.
Bonus Credit Amount:
For multifamily homes, 5 times the base amount if prevailing wage requirements are met. Initial guidance on the labor provisions is available here. (https://www.federalregister.gov/documents/2022/11/30/2022-26108/prevailing-wage-and-apprenticeship-initial-guidance-under-section-45b6bii-and-other-substantially)
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