Treasury Releases Final Rules for Energy Tax Credit Prevailing Wage, Apprenticeship Bonuses
The Inflation Reduction Act modified and extended many energy tax incentives used in residential construction, including requiring taxpayers to meet prevailing wage and/or apprenticeship requirements in order to claim the full value of the tax credit. The Treasury Department and Internal Revenue Service (IRS) have now released final regulations on these labor requirements.
To claim the full credit amount for certain incentives, taxpayers are required to pay workers the “prevailing wage,” and in other cases, also hire a certain number of registered apprentices.
The prevailing wage requirements apply to multifamily projects claiming the Section 45L New Energy Efficient Home Tax Credit.
The prevailing wage and apprenticeship requirements apply to the Section 45 Production Tax Credit, the Section 48 Investment Tax Credit, and the Section 179D Energy Efficient Commercial Buildings Deduction, among others.
In 2022, based on initial guidance from the IRS, the Department of Labor issued two Frequently Asked Question (FAQ) documents to help taxpayers comply with these requirements: one on prevailing wage and the other on apprenticeships. These webpages now note the FAQs will be updated soon to reflect changes in the final regulations.
Latest from NAHBNow
Environmental Issues
May 30, 2025
NAHB Members Provide Final Recommendations for New WOTUS RuleNAHB members concluded their participation in multiple “waters of the United States” (WOTUS) listening sessions with strong showings in Washington, D.C., and Salt Lake City. In total, 12 NAHB members and four staff members from NAHB and state home builder associations (HBAs), representing 11 states, provided oral statements at listening sessions.
Workforce Development
May 30, 2025
Statement from NAHB Chairman Buddy Hughes on DOL Decision to Pause Job Corps Center OperationsNAHB Chairman Buddy Hughes issued the following statement after the Department of Labor announced it was pausing Job Corps center operations nationwide.
Latest Economic News
Economics
May 30, 2025
Multifamily Absorption Moves Lower for New ApartmentsThe percentage of new apartment units that were absorbed within three months after completion continued to trend lower, according to the Census Bureau’s latest release of the Survey of Market Absorption of New Multifamily Units (SOMA).
Economics
May 29, 2025
Treasury Yield Increase Drives Mortgage Rates Higher in MayMortgage rates continued their upward trend in May due to market volatility triggered by fiscal concerns and weaker U.S. Treasury demand. According to Freddie Mac, the average 30-year fixed-rate mortgage rose to 6.82% — a 9-basis-point (bps) increase from April. The 15-year fixed-rate mortgage increased by 5 bps to 5.95%.
Economics
May 28, 2025
Aging-in-Place Remodeling Work Fell While Familiarity and Receptiveness Remain HighOnly 56% of professional remodelers undertake projects designed to allow homeowners to Age-in-Place (AIP), according to results from NAHB’s Q1 2025 Remodeling Market Index (RMI) survey.