45L Tax Credit: The Basics

What is the 45L tax credit?

+

Who receives the tax credit?

+

What types of homes are eligible and how much is the tax credit?

+

Single-family homes must meet the requirement of one of these programs to qualify for the tax credit amounts.

Single-Family Eligible Programs 45L Tax Credit Amount
ENERGY STAR Single-Family New Homes $2500 per home
DOE Zero Energy Ready Home $5000 per home

*Note: BetterBuiltNW focuses on single-family new homes. Additional information for multifamily homes is not included in this Resource Hub. Refer to the ENERGY STAR and DOE Zero Energy Ready Home sites for more information on multifamily program requirements for the 45L tax credit.

IRS 45L Tax Credit Resources

The IRS manages and determines all legal requirements for the 45L tax credit. BetterBuiltNW recommends individuals or entities looking to claim the 45L Tax Credit consult with an independent tax professional prior to claiming this credit. The information provided on the BetterBuiltNW website does not constitute professional tax, legal advice, or other professional financial guidance.

To find tax credit resources for builder of new energy-efficient homes, requirements, and guidance documents visit the link below.

IRS Tax Credit Resources

A Builder’s Guide: Steps to Maximize the 45L Tax Credit

  • Step 1: Assemble the right team

    +

  • Step 2: Set energy efficiency targets early

    +

  • Step 3: Combine federal 45L tax credit with local utility incentive programs (if available in your area)

    +

  • Step 4: Promote energy efficiency benefits of a 45L home to attract homebuyers and boost sales

    +

45L Approved Energy Efficiency Programs for Single-Family Homes

One of the first decisions to make when pursuing the 45L tax credit is determining which approved energy-efficiency program to follow. BetterBuiltNW compiled the following key information and resources for the two 45L-eligible energy efficiency programs for single-family homes.

Note: BetterBuiltNW focuses on single-family new homes. Additional information for multifamily homes is not included in this Resource Hub. Refer to the ENERGY STAR and DOE Zero Energy Ready Homes websites for more information on multifamily program requirements for 45L.

  • ENERGY STAR Single-Family New Homes

    Tax Credit Amount

    $2,500 per home

    ENERGY STAR Single-Family New Homes

    Tax Credit Amount

    $5,000 per home

  • Eligible Program Versions by Northwest States

    ENERGY STAR Single-Family New Homes (SFNH)

    2023 + 2024 Acquired Homes

    • Idaho + Montana: SFNH National v3.1
    • Oregon + Washington: SFNH Oregon + Washington v3.2 or SFNH National v3.2



    2025 Acquired Homes
    Idaho, Montana, Oregon, + Washington: SFNH National v3.2


    The minimum ENERGY STAR program versions eligible for the 45L tax credit for acquisitions beginning in 2023 are governed by EPA's defined effective dates and the timelines established in 45L by the IRS.

    DOE Zero Energy Ready Home (DOE ZERH)

    Single-Family Home Permitted on/after 6/1/2019

    • DOE ZERH Version 1, Rev 7



    Single-Family Home Permitted on/after 1/1/2023

    • DOE ZERH Version 1, Rev 8



    Rev 8 Single-Family Home Permitted on/after 1/1/2024

    • DOE ZERH Single-Family Version 2, Rev 1


    The DOE ZERH applicable program version is based on permit date. All Northwest states (ID, MT, OR, + WA) follow the national DOE ZERH requirements.

  • Program Partnership Requirements

    ENERGY STAR Single-Family New Homes (SFNH)

    Builders must sign a Partnership Agreement with ENERGY STAR.

    Builders must work with:
    An approved Energy Rating Company, that completes energy analysis, third-party verification, and certifies home meets ENERGY STAR SFNH program requirements.
    A credentialed HVAC Contractor (if applicable, depending on ENERGY STAR HVAC track pursued)

    DOE Zero Energy Ready Home (DOE ZERH)

    Builders must register as a DOE ZERH Partner.

    Builders must work with:
    An approved Verifier, that completes energy analysis, third- party verification, and certifies home meets DOE ZERH program requirements*.

  • Program Resources

    ENERGY STAR Single-Family New Homes (SFNH)

    ENERGY STAR 45L Tax Credits for Home Builders
    ENERGY STAR SFNH Program Requirements
    ENERGY STAR SFNH Certification Process

    DOE Zero Energy Ready Home (DOE ZERH)

    Section 45L Tax Credits for Zero Energy Ready Homes
    DOE ZERH Program Requirements

*Note: The ENERGY STAR and Indoor airPLUS programs are prerequisites for DOE ZERH. DOE ZERH qualifying homes are only eligible for a $5,000 tax credit and cannot stack tax credits for also meeting ENERGY STAR program requirements.

Find Certified Professionals

The ENERGY STAR Single-Family New Homes and DOE Zero Energy Ready Homes programs require builders to work with certified professionals who can ensure program requirements are met. To find certified professionals qualified to work in each program and access important tools, follow the links below.

BetterBuiltNW Resources

Check out these BetterBuiltNW Resources and Trainings related to meeting the 45L Tax Credit Requirements

FAQs

View these frequently asked questions for answers to common questions about the 45L tax credit. Send any additional questions to BetterBuiltNW at: info@betterbuiltnw.com.


Note: The IRS manages and determines all legal requirements for the 45L tax credit. BetterBuiltNW recommends individuals or entities looking to claim the credit first consult with an independent tax professional. The information provided on this website does not constitute professional tax, legal advice, or other professional financial guidance.

  • How does a builder or developer determine if they are eligible to claim the tax credit?

    +

  • Does the home or apartment have to be sold?

    +

  • Are custom builders building on clients’ land eligible to claim the 45L tax credit?

    +

  • If a developer hires a general contractor to build a rental property, who is eligible to claim the tax credit?

    +

  • If a developer hires a GC to build a development and the developer sells the homes, who can claim the credit?

    +

  • Are non-profit builders eligible for the tax credit? If so, what paperwork is required to claim the credit?

    +

  • We are building multiple dwelling units—including a primary residence and a few accessory dwelling units—on one property lot and plan to sell each unit individually. Is each unit eligible for the 45L tax credit?

    +

  • What energy modeling software programs currently support the 45L tax credit?

    +

  • What Rater/verifier qualifications are required?

    +

0 Resources Selected

Your Selection

Share