Service 06
Commercial Building Tax Incentives Review (179D)
You completed a commercial building three years ago. Your CPA never mentioned 179D. Your architect didn't know they qualified as the 'designer' who could claim the deduction. Meanwhile, $200,000–$500,000 in legitimate federal tax deductions is sitting unclaimed — and the program has a sunset date. Every month you wait is money left on the table that you earned by building an energy-efficient building.
Support for building owners, designers, ESCOs, and tax professionals evaluating qualifying energy-efficiency projects. Eligibility and tax benefits depend on current law and project-specific qualifications. Consult a qualified tax professional. 179D has been in effect since 2006 and is scheduled to terminate for buildings for which construction begins after June 30, 2026.
Who Qualifies for 179D — And Who Doesn't
179D applies to newly constructed or renovated commercial buildings (including government buildings, schools, hospitals, and multifamily 4+ stories) that meet energy-efficiency thresholds for HVAC, building envelope, or lighting systems. The deduction is up to $5.81 per square foot (2025 rate, inflation-adjusted annually).
The 'designer' — the architect, engineer, or contractor primarily responsible for the energy-efficient design — can claim the deduction on government-owned buildings. On privately owned buildings, the building owner claims it directly. The prevailing-wage/apprenticeship multiplier increases the deduction from $1.00/SF to the full $5.81/SF for qualifying projects.
You likely don't qualify if: the building is single-family residential (1–3 units), the construction began after June 30, 2026 (current sunset), or the building doesn't meet the minimum 25% energy-efficiency improvement threshold over ASHRAE 90.1-2007 baseline.
Building owners, architects, engineers, ESCOs, and CPAs with recently constructed or renovated commercial buildings that may qualify for energy-efficiency tax deductions.
Not applicable to single-family residential (1–3 units), buildings that don't meet the 25% energy-efficiency improvement threshold, or buildings where construction begins after the current sunset date.
Speak with Danto
Get a straight answer on feasibility, budget, and schedule for your project.
Schedule ConsultationWhat 40 Years in This Market Teaches You.
South Florida's cooling-dominated climate means HVAC systems are the primary driver of 179D qualification. High-efficiency chillers, VRF systems, and energy-recovery ventilators often meet the threshold without envelope or lighting upgrades.
Government buildings in Broward, Miami-Dade, and Palm Beach counties — courthouses, libraries, fire stations, schools — qualify for designer allocation. If you're the architect or engineer of record, you may be leaving significant deductions unclaimed.
Hotels and hospitality: South Florida's hotel construction boom means hundreds of qualifying buildings exist. A 200-room hotel at 150,000 SF could generate up to $871,500 in deductions at the full $5.81/SF rate.
179D has been in effect since 2006 and is currently scheduled to terminate for buildings where construction begins after June 30, 2026. Buildings already under construction or completed remain eligible for certification.
How We Run It
Qualification Screening
Deliverable: Written eligibility assessment
We review your building's mechanical drawings, lighting plans, and envelope specifications against 179D requirements. Within 5 business days, you receive a written assessment: eligible or not, estimated deduction amount, and required documentation.
Energy Modeling
Deliverable: Whole-building energy simulation (IRS-compliant software)
Our certified energy analysts run a whole-building energy simulation using IRS-approved software (eQUEST, EnergyPlus, or equivalent) comparing your building's performance against the ASHRAE 90.1-2007 baseline.
Certification
Deliverable: 179D certification letter + supporting calculations
Maximum Energy Payback (MEP), a dba of Danto Builders, LLC, issues the formal 179D certification letter with supporting energy calculations — the document your CPA needs to claim the deduction on your tax return.
CPA Coordination
Deliverable: Tax-return-ready documentation package
We provide your CPA with the complete documentation package: certification letter, energy model results, building specifications, and the IRS-required statement. We're available to answer your CPA's technical questions.
Questions You May Have
How much does the 179D certification process cost?
Our fee is typically 15–25% of the certified deduction amount — paid only if the building qualifies. On a 50,000 SF building qualifying for the full $5.81/SF ($290,500 deduction), expect a fee of $43K–$72K. The ROI is 4:1 to 6:1 — you spend $1 to get $4–$6 in tax deductions.
Can I claim 179D on a building that was completed years ago?
Yes. You can amend prior-year tax returns to claim 179D deductions for buildings placed in service in open tax years (typically the last 3 years, though some circumstances allow further lookback). Many of our clients are claiming deductions on buildings completed 2–5 years ago.
What's the difference between the $1.00/SF and $5.81/SF deduction?
The base deduction is $0.50–$1.00/SF. The enhanced deduction ($2.50–$5.81/SF) requires that the project meet prevailing-wage and apprenticeship requirements during construction. Most commercial projects in South Florida already meet prevailing-wage thresholds — they just need documentation to prove it.
Does 179D apply to tenant build-outs or only base buildings?
Both. If the tenant build-out includes qualifying HVAC, lighting, or envelope improvements that meet the energy-efficiency threshold, the tenant (or building owner, depending on lease structure) can claim the deduction. This is commonly overlooked on large office and retail build-outs.
Ready to bring your vision to life? Let's talk.
Whether you are evaluating a site, preparing a renovation, or planning a ground-up commercial development, an early conversation can help you clarify scope, timelines, budget considerations, and next steps.