October 18, 2006—The US Internal Revenue Service (IRS) recently announced that commercial property owners can potentially enjoy significant tax deductions by making their buildings more energy efficient, and in its Notice, also officially approved Trane’s TRACE 700 software to certify energy savings.
Trane’s TRACE 700 software, the first of four programs accepted by the IRS for energy savings certification, enables building owners to translate energy savings into tax deductions, says the company.
The commercial building deduction, enacted in the Energy Policy Act of 2005, allows taxpayers to deduct the cost of energy efficient property installed in commercial buildings. Buildings that achieve a 50 percent energy savings target can deduct up to $1.80 per square foot of building floor area. Buildings below the 50 percent threshold may still qualify for a deduction of up to 60 cents per square foot of floor space, if they meet a 16.67 percent energy savings target for HVAC equipment.
The TRACE program is an analytic tool for building system designers, allowing them to optimize the building, system and equipment designs on the basis of energy utilization and life-cycle costs.
Trane, the air conditioning systems and services business of American Standard Companies, is a leading global provider of indoor comfort systems and comprehensive facility solutions. For more information, see the Web site.
