ENERGY EFFICIENT NEW HOMES TAX CREDIT

Site-built homes qualify for a $2,000 credit if they are certified to reduce heating and cooling energy consumption by 50% relative to the International Energy Conservation Code (IECC) 2006 and meet minimum efficiency standards established by the Department of Energy.

Energy-Efficient New Homes Tax Credit for Home Builders

Note: Section 13304 of The Inflation Reduction Act of 2022 (H.R. 5376) modified this tax credit and extended the expiration date credit from December 31, 2021 to December 31, 2032. The changes to the credit take effect January 1, 2023. The summary below describes the credit before and after H.R. 5376. 

Tax Credit for homes constructed and acquired before January 1, 2023:

The federal Energy Policy Act of 2005 established tax credits of up to $2,000 for builders of all new energy-efficient homes, including manufactured homes constructed in accordance with the Federal Manufactured Homes Construction and Safety Standards. Initially scheduled to expire at the end of 2007, the tax credit was extended several times

The home qualifies for the credit if:

It is located in the United States;
Its construction is substantially completed before December 31, 2021;
It meets the energy saving requirements outlined in the statute; and
It is acquired from the eligible contractor after December 31, 2013, and before January 1, 2022, for use as a residence.

Energy Saving Requirements
Site-built homes qualify for a $2,000 credit if they are certified to reduce heating and cooling energy consumption by 50% relative to the International Energy Conservation Code (IECC) 2006 and meet minimum efficiency standards established by the Department of Energy. Building envelope component improvements must account for at least one-fifth of the reduction in energy consumption.

Manufactured homes qualify for a $2,000 credit if they conform to Federal Manufactured Home Construction and Safety Standards and meet the energy savings requirements of site-built homes described above. Manufactured homes qualify for a $1,000 credit if they conform to Federal Manufactured Home Construction and Safety Standards and reduce energy consumption by 30% relative to IECC 2006. In this case, building envelope component improvements must account for at least one-third of the reduction in energy consumption. Alternatively, manufactured homes can also qualify for a $1,000 credit if they meet ENERGY STAR Labeled Home requirements.

NM State Tax Credits