Building sustainably is not only good for the environment but also for your wallet. The 2022 Inflation Reduction Act (IRA) has ushered in a new era of tax credits for energy-efficient buildings, and Structural Insulated Panels (SIPs) are your ticket to reaping the benefits. Whether it's improving efficiency in multifamily housing, meeting ENERGY STAR standards in single-family homes, retrofitting commercial spaces, or enhancing insulation, SIPs make it a breeze to build sustainably and qualify for incentives and rebates through sections 45L, 25C, and 179D of the IRA.

45L Homebuilder Tax Credit:

SIPs help you meet the requirements for this tax credit, offering up to $5,000 per dwelling unit for ENERGY STAR and Zero Energy Ready Homes Program certifications.

1. The credit amount increases to $5,000for dwelling units certified under the Zero Energy Ready Homes Program (ZER).
2. Base qualification for multifamily units is now set at $500, while ZER multifamily units garner $1,000 each.
3. Multifamily units adhering to prevailing wage requirements receive an elevated $2,500 credit for base qualification and $5,000 for ZER certification.
4. Initially, this credit applied solely to low-rise residential developments, but it has since been extended to encompass homebuilders and single-family or multifamily developers. The base qualification prerequisites for these developers mandate compliance with both national and local energy-saving standards.

25C Home Efficiency Improvement Tax Credit

With SIPs' high R-value and quick installation, you can qualify for a 30% tax credit (up to $1,200 annually) and potential rebates.

• Previously identified as the Nonbusiness Energy Property Credit, the IRA has breathed new life into this tax credit, substantially augmenting the amount homeowners can assert for energy-efficient home upgrades like insulation and exterior doors.
• The enhanced 25C now offers a 30% tax credit (up to $1,200 annually) to homeowners who embark on specific measures to enhance their homes' energy efficiency. Furthermore, these 25C tax credits can be coupled with rebates forthcoming from the DOE's $8.8 billion Home Energy Rebates Program. However, please note that these funds won't be accessible to homeowners until at least early 2024.
• Utilizing retrofit insulated panels can result in both a higher R-value and a faster installation compared to other alternatives, facilitating eligibility for insulation credits under 25C. Discover more about how embracing eco-friendly solutions can enable taxpayers to qualify for expanded home energy tax credits.

179D Tax Deduction for Energy-Efficient Commercial Buildings

 SIPs can play a role in securing deductions of up to $5 per square foot for energy-efficient projects.

By choosing SIPs, you create a high-performance building envelope that minimizes thermal bridging and reduces air infiltration, resulting in lower energy costs. SIPs meet and exceed building code requirements and offer exceptional thermal performance, saving up to 60% on energy compared to traditional construction. They also provide superior airtightness, enhancing indoor air quality. With SIPs, you not only build sustainably but also unlock the benefits of IRA tax credits and incentives, making your project more eco-friendly and cost-effective.

Achieving eligibility for IRA tax credits becomes more accessible when you choose SIPs for your building project. SIPs create a high-performance building envelope that plays a crucial role in qualifying for these valuable incentives. By opting for SIPs, you benefit from a continuous insulation envelope that minimizes thermal bridging and reduces air infiltration, resulting in significantly reduced heating and cooling expenses. Explore the comprehensive advantages of SIPs in our SIP Design Best Practices Series.

SIPs not only meet but exceed building code thermal envelope requirements, eliminating the need for additional continuous insulation on the exterior, thereby meeting the 2021 and 2018 IECC building codes. They lead to substantial energy savings in SIP homes, ranging from 40-60% compared to traditional stick-frame construction, depending on the climate zone.

Moreover, SIPs offer airtight structures, a pivotal factor in enhancing indoor air quality (IAQ). With 85-88% less air leakage than stick-frame construction, SIPs provide exceptional thermal performance across a range of thicknesses. Various SIP connections are available to minimize thermal bridging, ensuring consistent energy efficiency.

SIPs come equipped with factory-applied rigid foam insulation cores, erasing concerns about the quality of insulation installation. This, in turn, results in reduced HVAC requirements and significant energy savings. Additionally, applying retrofitted panels to a home's exterior can further elevate its R-values, enhancing overall energy efficiency.

In summary, selecting SIPs as your building material empowers you to meet IRA tax credit qualifications seamlessly. With their exceptional thermal properties, energy efficiency, and airtightness, SIPs offer a comprehensive solution for sustainable and cost-effective construction. Don't miss out on the benefits of building with SIPs.