Home Builder Alert: 7 Months Left for Tax Credit

I want to alert you to an important deadline that affects your upcoming projects. The federal energy efficient home builder credit offers up to $5,000 per qualifying home, but the opportunity ends on June 30, 2026. You still have time to benefit, but you must act quickly.

This credit rewards builders and manufacturers who construct or substantially renovate energy-efficient single-family, multifamily, or manufactured homes. To qualify, you must own the home during construction, meet the required energy efficiency standards, and ensure that an individual purchases or leases the home as a residence no later than June 30, 2026.

The credit amount depends on the home type, its Energy Star or Zero Energy Ready Home certification, and whether you meet prevailing wage rules for multifamily projects. Credit amounts range from $500 to $5,000 per unit.

You must keep documentation that proves the home meets the required standards, that you qualify as the builder or producer, and that the buyer/tenant acquired or rented the home or apartment for residential use within the allowed period. You claim the credit on IRS Form 8908, and if your business operates as a partnership, an LLC, or an S corporation, the credit will flow through to you.

Keep in mind that claiming the credit requires a reduction to your basis in the home or building. Even so, the financial benefit usually far outweighs the adjustment.

If you plan to start or finalize projects in the coming months, I encourage you to review your timelines now. With only seven months left, efficient planning can help you secure these valuable credits before they disappear.