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Letter to the Editor: Expand Energy Efficiency Incentives
Dear Editor:
I applaud and appreciate NAHB's efforts in promoting energy efficiency tax credits; however, there is a gap in the system. In order to be eligible for the tax credit, the property must be either a new home or a principal residence. Investors who acquire single-family homes for renovation and sale are not eligible for the credit.
Every opportunity to improve home energy efficiency should be exploited.
Investors who purchase single-family homes, especially REOs, often must improve the property's windows, exterior doors, roofs and HVAC systems — among other building elements — in order to be able to sell them. An investor will not expend the extra money to incorporate higher energy-efficient components if there is no financial return, knowing that the buyer of the property will be satisfied that the furnace, windows, appliances, etc. are new. This is a missed opportunity.
Investors who renovate single-family homes should be eligible for the Energy Efficiency Tax Credit. The credit should be available on the same terms — 30% of the cost, up to $1,500. This should be on a per-unit basis. A similar tax deduction is available to commercial building.
This incentive would allow investors to incorporate high energy-efficient components into the housing stock. Expanding the tax credit in this manner is an efficient way of increasing home energy efficiency, while assisting purchasers of these existing homes to reduce their long-term energy costs. At a time when the REO inventory is turning over, every effort should be made to ensure that these properties are consistent with the national goal of energy efficiency.
Sincerely,
Thurmon A. Cohen
Robbinsville, N.J.
Editor's note: The 45L tax credit does apply to substantial renovation jobs. Work with a tax professional to determine whether your project qualifies.
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