Energy-Efficient Appliance Tax Credit for Manufacturers
| Incentive Type: |
Corporate Tax Credit |
| Eligible Efficiency Technologies: |
Clothes Washers, Dishwasher, Refrigerators/Freezers |
| Applicable Sectors: |
Industrial, Appliance Manufacturers |
| Amount: |
Dishwashers: $45 or $75 per unit, varies by energy and water efficiency;
Clothes washers: $75 – $250 per unit,varies by type, and energy and water eficiency;
Refrigerators: $50 – $200, depending on energy efficiency rating |
| Maximum Incentive: |
The aggregate amount of credit allowed is $75 million per taxpayer. Certain refrigerators and clothes washers will not add to the aggregate credit amount. See summary below for more details. |
| Carryover Provisions: |
Not specified |
| Equipment/Installation Requirements: |
Appliances must meet Energy Star 2007 requirements; must be new and in compliance with all applicable performance and safety standards |
| Authority 1: |
26 USC § 45M |
| Date Enacted: |
8/8/2005 |
| Date Effective: |
1/1/2006 |
| Expiration Date: |
12/31/2007 |
| Authority 2: |
H.R. 1424: Div. B, Sec. 305 (The Energy Improvement and Extension Act of 2008) |
| Date Enacted: |
10/3/2008 |
| Date Effective: |
1/1/2007 |
| Expiration Date: |
Varies by appliance and efficiency level |
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Summary:
The Energy Policy Act of 2005 established tax credits for manufacturers of high-efficiency residential clothes washers, refrigerators, and dishwashers produced in calendar years 2006 and 2007. The Energy Improvement and Extension Act of 2008 (H.R. 1424, Division B) extended the credits for additional years depending on the efficiency rating of the manufactured appliance. Manufacturers only receive these credits for the increase in production of qualifying appliances over a two-year rolling baseline, and only appliances produced in the United States are eligible.
Credits available to manufacturers are as follows:
Dishwashers
- $45 for models manufactured in calendar year 2008 or 2009 which use no more than 324 kilowatt hours (kWh) per year and 5.8 gallons per cycle.
- $75 for models manufactured in calendar year 2008, 2009, or 2010 which use no more than 307 kWh per year and 5.5 gallons per cycle .
Clothes washers
- $75 for residential top-loading models manufactured in 2008 which meet or exceed a 1.72 modified energy factor (MEF) and do not exceed a 8.0 water consumption factor (WCF).
- $125 for residential top-loading models manufactured in 2008 or 2009 which meet or exceed a 1.8 MEF and do not exceed a 7.5 WCF.
- $150 for a residential or commercial models manufactured in 2008, 2009, or 2010 which meet or exceed a 2.0 MEF and does not exceed a 6.0 WCF.
- $250 for residential or commercial models manufactured in 2008, 2009, or 2010 which meet or exceed a 2.2 MEF and do not exceed a 4.5 WCF.
Refrigerators
- $50 for models manufactured in 2008 which are between 20% and 22.9% more efficient than the 2001 energy conservation standards.
- $75 for models manufactured in 2008 or 2009 which are between 23% and 24.9% more efficient than the 2001 energy conservation standards.
- $100 for models manufactured in 2008, 2009, or 2010 which are between 25% and 29.9% more efficient than the 2001 energy conservation standards.
- $200 for models manufactured in 2008, 2009, or 2010 which are at least 30% more efficient than the 2001 energy conservation standards.
Each manufacturer is limited to a total of $75 million for all credits under this provision. However, refrigerators manufactured in 2008, 2009, or 2010 which consume at least 30% less energy than the 2001 energy conservation standards will not add to the aggregate credit amount and have no separate credit limit. Residential and commercial clothes washers manufactured in 2008, 2009 or 2010 which meet or exceed a 2.2 MEF and do not exceed a 4.5 WCF also will not add to the aggregate limit and have no separate credit limit.
The 2007 IRS Form 8909 is available here. For more information on qualifying products, visit the Energy Star Web site.
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