Sometimes they say the devil is in the details. For those that care about sustainability and jobs, the God is in the details. Tax rules and regulations that will decrease energy use and increase jobs without sacrificing tax dollars. Its a rare, true win-win-win. Win for business, win for jobs, win for the environment and energy security.
It adjusts the EPAct Section 179D from a tax deduction to a tax credit.
In previous years if you bought a $50,000 HVAC or building management system you could deduct (reduce your income) by $50,000. Assuming a 35% tax bracket this would have saved you $17,500 in taxes, making your net cost of the new system $32,500. This was still a great deal for a building owner.
The new proposal (and it is just a proposal, not law yet) will allow you to have a tax credit of the $50,000. So instead of saving 17,500 in taxes you will save the entire 50,000 in taxes, bringing your net cost on the system to ZERO.
The tax system will not suffer from a loss of revenue though. Although the building owners will pay less taxes when making the upgrades, the employers and employees doing the work will add to the tax rolls.