The Consolidated Appropriations Act of 2021 (the “CAA” or the “Act”) was signed into law on December 27, 2020. At 5,593 pages, the Act is one of the largest in history, and can be viewed in full at here. The CAA establishes funding for government operations throughout the fiscal year. It also contains a number of personal and business tax provisions, and those most relevant to Capstan clients will be briefly reviewed here.
EPAct 179D Deduction
Congress crafts tax extension packages annually, and these packages generally extend incentives by a certain number of years. In exciting news, the CAA permanently extended the EPAct 179D tax deduction. It will be adjusted for inflation beginning in 2021. This powerful incentive can help investors more confidently move forward, knowing that they can earn up to $1.80/SF in deductions. As before, properties eligible for the 179D deduction may be either commercial property or residential rental property at least 4 stories high. New construction and renovation projects are both eligible for this tax strategy. Energy-efficient improvements made to the following building assets can contribute to this benefit:
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