Energy Efficiency for Affordable Housing Act

To amend the Internal Revenue Code of 1986 to increase the low-income housing credit for rehabilitation expenditures for buildings achieving enhanced energy performance, and for other purposes. 1. Short title This Act may be cited as the Energy Efficiency for Affordable Housing Act 2. Increase of credit (a) In general Paragraph (2) of section 42(e) (C) Increase in credit for buildings achieving enhanced energy performance (i) In general In the case of any existing building to which subsection (b)(2) does not apply which achieves enhanced energy performance, the rehabilitation expenditures taken into account under subparagraph (A) shall be 130 percent of such expenditures determined without regard to this subparagraph. (ii) Enhanced energy performance For purposes of clause (i), a building achieves enhanced energy performance if it meets either of the following: (I) The minimum requirements of an advanced building construction standard which shall be determined by the Secretary of Energy using prescriptive or performance methods of calculation and promulgated by the Secretary of Energy within 180 days of the date of the enactment of this subparagraph. (II) In the case of a taxpayer which elects (at such time and in such manner as the Secretary may provide) the application of this subclause with respect to the building, a qualified retrofit plan. (iii) Definitions For purposes of this subparagraph— (I) Qualified retrofit plan The term qualified retrofit plan (aa) the baseline energy usage intensity of the building, (bb) that the modifications are expected to reduce such building’s site energy usage intensity by 50 percent or more in comparison to the baseline energy usage intensity of such building, and (cc) as of any date following installation of building modifications, that such modifications have been installed. (II) Baseline energy usage intensity The term baseline energy usage intensity (III) Site energy usage intensity The site energy usage intensity shall be determined for the entire building in accordance with such regulations or other guidance as the Secretary may provide and measured in British thermal units per square foot per year. (IV) Qualified professional The term qualified professional . (b) Increase for buildings in high-Cost areas Paragraph (2) of section 42(e) (D) Special rule for buildings in high-cost areas which achieve enhanced energy performance In the case of an existing building to which both subparagraph (C) and subsection (d)(5)(B) apply (but for this subparagraph)— (i) subsection (d)(5)(B)(i)(II) shall not apply, and (ii) the rehabilitation expenditures taken into account under subparagraph (A) shall be 160 percent of such expenditures determined without regard to this subparagraph. . (c) Effective date (1) In general Except as provided in paragraph (2), the amendments made by this section shall apply to buildings with respect to which housing credit dollar amounts are allocated after December 31, 2021. (2) Bond-financed projects In the case of any building some portion of which, or of the land on which the building is located, is financed by an obligation which is described in section 42(h)(4)(A) 3. Coordination with basis adjustment under new energy efficient home credit (a) In general Subsection (e) of section 45L any property any property (other than a qualified low-income building, as defined in section 42(c)(2)) (b) Extension of credit Subsection (g) of section 45L December 31, 2021 December 31, 2031 (c) Effective date The amendments made by this section shall apply to qualified new energy efficient homes acquired after December 31, 2021.

Summary: Energy Efficiency for Affordable Housing Act This bill increases the amount of the low-income housing tax credit for rehabilitation expenditures for buildings that achieve enhanced energy performance. The bill also exempts such credit from the basis adjustment applicable to the new energy efficient home tax credit and extends that credit through 2031.