What is Section 179D?

Section 179D (EPAct) is a federal tax deduction allowing commercial building owners in the Carolinas to deduct the cost of energy-efficient LED lighting upgrades from taxable income-immediately, in the year installed.

How Much Can You Deduct?

2025 Rates:

• $4.00-$5.81 per sq ft with prevailing wage compliance

• $1.16 per sq ft without prevailing wage compliance

• Pro-rated amounts for partial building upgrades

Who Qualifies?

Property Types: Offices, retail, warehouses, manufacturing, healthcare, schools, hotels, multi-family (4+ stories)

Property Owners: Corporations, LLCs, partnerships, sole proprietors, REITs paying federal income tax

Carolina-Specific Benefits

Stack Federal + State + Utility Incentives:

• Section 179D federal deduction reduces both federal AND North Carolina state taxes

• Duke Energy Smart $aver® rebates: $0.10-$0.30 per kWh saved

• Local utility rebates from electric cooperatives

• All incentives can be claimed simultaneously

Quick Calculation

Your Building Square Footage × $4.50 = Total Deduction

Total Deduction × Your Tax Rate = Tax Savings

Example: 50,000 sq ft × $4.50 = $225,000 deduction
$225,000 × 21% = $47,250 tax savings

Important Deadline

Act Before June 30, 2026: Current favorable deduction rates may not apply to projects starting after this date. Plan your LED upgrade now to lock in maximum benefits.

Common Questions

Can I combine Section 179D with Duke Energy rebates?

Yes! Utility rebates don't reduce your Section 179D deduction. Claim both for maximum savings.

What about leased buildings?

Generally, whoever pays for improvements and pays income tax can claim the deduction. Consult your tax advisor.

How quickly can I claim the deduction?

Immediately, in the tax year when equipment is placed in service—no depreciation schedule required.

Can I claim this for past projects?

Yes, file amended returns for projects within the last 3 years.

Why Work with Charlotte LED Pros

• Full-Service Coordination: We manage energy modeling, certifications, and compliance

• Duke Energy Rebate Experts: $1.75M+ in rebates secured for Carolina clients

• Complete Documentation: All paperwork needed for your tax filing

• Proven Track Record: Numerous successful Section 179D projects across NC/SC

Get Started Today

Step 1: Free facility assessment
Step 2: Detailed proposal with Section 179D calculation
Step 3: Professional energy modeling
Step 4: Installation with full compliance
Step 5: Complete documentation for tax filing