Renters
Renters can play a part in the energy transition. When you are looking for a rental ask questions about the energy efficiency of the appliances and building. Tell landlords, property managers and neighbors about incentives and programs that increase energy efficiency, lower indoor air pollution, and allow access to lower cost solar energy and to EV chargers. These improvements benefit everyone. They can be selling points for landlords; several New Mexico apartment complexes advertise EV chargers to attract tenants.
While the Inflation Reduction Act is aimed primarily at homeowners, there are some benefits for renters as well.
Rebates
There are a few rebates for portable items you can take with you. When you enter your information into Rewiring America’s IRA benefits calculator, be sure to put “renter” in the homeowner status menu bar. Depending on your income, you may qualify for federal point-of-sale rebates for a heat pump clothes dryer and an electric or induction hot plate or cooktop when they become available at the end of 2023. Window-unit heat pumps are expected to become eligible in 2024/2025, according to Rewiring America. Electrify Now’s fact sheet on Portable Heat Pumps.
If you pay the utility bill directly, also check with your electricity provider, including rural electric coops, for additional rebates. See more incentives for renters and The Switch is On‘s Kitchens Electrification for Renters.
Tax credits.
There are incentives for renters with incomes high enough to owe federal income tax. Nonrefundable tax credits will lower the price of new (up to $7,500) and used (up to $4,000) electric vehicles. (Check out suggestions for renters in Electric Vehicles and EV Chargers and in Resources for Low-Income Residents about driving electric and rebates for chargers). Nonrefundable means you can’t get back more on the credit than you owe in taxes. If you do not owe any taxes, you will not get a credit.
Renters, and not landlords, may obtain the following nonrefundable tax credits from 2023-2032 for energy efficiency upgrades and appliances, according to this IRS fact sheet. The credits are 30% of the costs minus any rebates (excluding state incentives). If your income is high enough to get the credit, it might be worth talking to your landlord about splitting the cost or lowering the rent in return for improvements to the property. Click on the links below for the fine print.
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- Energy Efficient Home Improvement Credit for home energy audits, qualified heat pumps, heat pump water heaters and other appliances, and windows, doors, insulation and other weatherization measures.
- Residential Clean Energy Property Credit for 30% of equipment and installation costs of Solar Panels, Solar Water Heaters, Geothermal Heat Pumps, and Battery Storage.
Renewable Energy.
Even as a renter with no solar panels on your roof, your power can come from clean energy sources. Sign up for a green power plan with your electricity provider such as PNM’s Sky Blue program (this costs more). Or subscribe to a Community Solar project when they come on line (this should cost less).
Landlords and Builders
Please consult your tax adviser for complete information on rebates, tax credits and tax deductions you may qualify for. 350NM is not responsible for the accuracy of the tax information presented on our website.
Watch landlord Lincoln Eccles and BlocPower CEO Donnel Baird discuss why and how they install heat pumps in apartment buildings. Baird wants to turn buildings into Teslas.
Tax deduction best for large apartment owners/builders. The Inflation Reduction Act expanded the Section 179D Tax Deduction to offer up to $5.00/ft2 for energy-efficiency construction or retrofit of a commercial property (like an apartment building or leased residence) from January 1, 2023 until 2032. The maximum deduction is for projects that meet wage and apprenticeship requirements. Improvements or installations include interior lighting, building envelope (e.g, windows, doors, roof), HVAC, ventilation and hot water systems. The deduction can go to building owners or the professionals who design the upgrades for tax-exempt entities (including schools, tribal and other governments, non-profits). It can be used in combination with the 45L tax credit. See this article and consult a tax advisor for more information.- Tax credit for new or renovated single or multifamily construction for energy efficiency. The Inflation Reduction Act enhanced the New Energy Efficient Home credit, or 45L Tax Credit for Zero Energy Ready Homes to provide $1,000 per unit in buildings constructed in accordance with the ENERGY STAR Multifamily New Construction (MFNC) program or $5,000 per unit if the project complies with prevailing wage requirements.
Rebates. Landlords of single- and multi-family units (as well as homeowners) can save through the Home Energy Performance-Based Whole-House (HOMES) rebate program of the Inflation Reduction Act if they can demonstrate energy savings ($2,000 rebate for 20% energy savings and $4,000 rebate for greater 35% capped at 50% of the project cost; Doubled for low- and moderate-income households, capped at 80% of project cost). In homes in disadvantaged communities, contractors receive $200. HOMES and IRA HEEHRA rebates cannot be combined together for the same piece of equipment, but rebates can be stacked with tax credits. Like the IRA HEEHRA rebate program, the HOMES program relies on guidance from the Department of Energy and will be administered by New Mexico which is required to submit a plan, so not all the details are known at this time. The program rollout also depends on first developing metrics for measuring energy reduction. So it may not become active until 2025 or later.- Also check out State Incentives (SBTC is available for landlords) and electricity provider programs for EV Chargers on our EV Charger page.