The Ultimate State-by-State Guide for the 179D Tax Deduction
for Energy Efficient Commercial Buildings
Get the Money You Didn't Know Was Yours!
If you thought this was going to be a long-winded page about all the legalities of getting the qualification for the section 179D tax deduction - you thought wrong. It’s already a major hassle to comb through all the language and check all the boxes for claiming this deduction. While we can provide you with all of that information, we’re not going to waste any more of your time. The truth is, if you’re a construction company, you may be missing out on money right now - all because of the time it takes to claim these funds.
Save Time & Money on Current Projects
If you’re looking for a project, or have a current project already, the Pivla solution can provide you with an instant eligibility notification to see if you qualify. We significantly collapse the application process time, removing weeks of long waiting and delays.
With Pivla, you can streamline the entire qualification process, saving you precious time and resources. Instead of spending weeks navigating through paperwork and bureaucratic hurdles, our platform offers a simple and efficient solution to determine your eligibility for the 179D tax deduction in mere moments.
By leveraging Pivla, you can focus your energy and resources on what truly matters - delivering exceptional projects and maximizing your profitability. Don’t let the complexities of tax deductions hold you back from claiming the money that’s already yours.
Use Credits for Sales Proposals: Help Win Bids
In the competitive landscape of construction and design, winning bids often comes down to offering added value and cost-saving solutions. One powerful tool at your disposal is leveraging the potential tax credits available through the 179D deduction to strengthen your sales proposals and increase your chances of winning bids.
Here's how incorporating 179D tax credits into your sales proposals can help you secure more projects:
Cost Savings Proposition
Including the potential savings from 179D tax credits in your sales proposals demonstrates to potential clients that you're committed to maximizing their return on investment. Highlighting the financial benefits they stand to gain can significantly enhance the attractiveness of your proposal compared to competitors who may not offer such incentives.
Enhanced Project Viability
By factoring in the savings generated through 179D tax credits, you can make your project proposals more financially viable for clients. This can be especially compelling for budget-conscious clients or those seeking to minimize long-term operational costs. Presenting a clear picture of the financial advantages can tip the scales in your favor during the decision-making process.
Differentiation and Competitive Edge
Incorporating 179D tax credits into your sales proposals sets you apart from competitors who may overlook or neglect to mention such benefits. It showcases your expertise and understanding of the intricacies of tax incentives, positioning you as a knowledgeable and forward-thinking partner. This differentiation can be a crucial factor in winning bids, particularly in markets where competition is fierce.
Building Trust and Confidence
By proactively addressing potential cost-saving opportunities through 179D tax credits, you instill confidence in your clients regarding your ability to deliver value beyond the scope of the project itself. This transparency and commitment to maximizing benefits can foster trust and strengthen your client relationships, increasing the likelihood of repeat business and referrals.
Prevailing Wage & Apprenticeship
Prevailing Wage
Prevailing wage refers to the standard wage rate set by government authorities for work on public projects, ensuring fair and competitive compensation for workers. These rates are determined based on local wage surveys and typically include both hourly wages and fringe benefits. To encourage compliance, governments offer prevailing wage tax incentives, which can be in the form of tax credits or deductions. These incentives provide financial benefits to contractors and businesses that adhere to prevailing wage laws, promoting fair labor practices, supporting local economies, and ensuring high-quality workmanship on public projects.
Apprenticeship
Apprenticeship requirements often mandate that contractors on public projects employ a certain ratio of apprentices to journeymen, ensuring workforce development and the continual training of new skilled workers. These programs typically require registered apprenticeships, which include structured on-the-job training and classroom instruction under the supervision of experienced professionals. To promote these initiatives, governments offer apprenticeship tax incentives such as tax credits or deductions. These financial benefits encourage businesses to invest in apprenticeship programs, supporting skill development, improving job readiness, and fostering economic growth through a skilled labor force.
Prevailing Wage & Apprenticeship FAQs
The IRA offers several clean energy tax incentives to taxpayers who meet specific prevailing wage and apprenticeship requirements. Projects that do not comply with these standards will generally receive only one-fifth of the full credit amount. Likewise, the maximum $5-per-square-foot Section 179D deduction is reduced to one-fifth if the requirements are not met. Exceptions exist for smaller projects and those that began construction before January 29, 2023.
Registering for prevailing wage and apprenticeship (PW&A) programs varies by governing body. A Prevailing Wage Contractor Registration (PWCR) typically takes about 30 days to process if the application is complete, but this timeline can vary based on application complexity, information completeness, and responsiveness of the apprenticeship program to any issues or requests within five business days.
This can be a lengthy process that takes too much time away from contractors.
Need some help streamlining your application? Let’s talk!
Many states have their own prevailing wage laws, often referred to as "little Davis-Bacon" laws. Like the federal Davis-Bacon Act, these state laws establish wage requirements for public works projects. A common misconception is that prevailing wage laws only apply to federally funded projects; however, many states enforce these requirements for state-funded projects as well. Currently, 32 states have their own prevailing wage laws, but the specific rules and regulations can vary significantly from state to state. Always check your state's guidelines to ensure compliance.
Prevailing wages are government-set rates that contractors must pay workers on public projects, based on local job classifications. Certified payroll is a report submitted by contractors documenting wages paid, hours worked, and fringe benefits to ensure compliance with these laws. Together, they uphold fair labor practices in public contracting.