Income Tax - Credit for Energy Efficiency Upgrades - Passive Houses
This legislation is expected to incentivize homeowners to make energy-efficient improvements, ultimately promoting environmental sustainability within the state. By reducing energy consumption in residential properties, SB317 could contribute to lower utility bills for homeowners, enhance the market value of homes, and align with broader climate initiatives aimed at reducing greenhouse gas emissions. The bill reflects Maryland's commitment to modernizing housing stock and improving energy performance across the state.
Senate Bill 317 seeks to introduce a tax credit against the Maryland state income tax for owners of residential properties who undertake specific energy efficiency upgrades. The bill defines eligible upgrades as improvements made on or after July 1, 2023, that utilize components certified by the Passive House Institute, aiming to enhance the efficiency of buildings. Examples of such upgrades include insulation enhancements, energy-efficient windows, and duct sealing. The credit provided under this bill can amount to 10% of the total costs incurred by the homeowner, with a cap of $2,000 for each upgrade.
One significant aspect of the bill is the stipulation that taxpayers may not claim the tax credit during any taxable year in which the Governor has declared a state of emergency due to economic disruption. This provision has raised some concerns, as it may dissuade homeowners from investing in energy upgrades during times of economic uncertainty. Critics argue that it could hinder individuals who are already facing financial hardships from benefiting from potential cost savings associated with energy-efficient upgrades.