Bill > HB760

This bill establishes new state income tax credits for the construction of energy-efficient homes, available for taxable years 2026 through 2033. An "energy-efficient home" is defined as a new single-family home that meets specific standards from the U.S. Environmental Protection Agency's Energy Star New Homes Program or achieves a certain Home Energy Rating System (HERS) index score, which measures a home's energy performance. The bill distinguishes between "entry-level homes" (2,000 square feet or less) and "move-up homes" (over 2,000 to 2,600 square feet). Eligible contractors who construct these homes can claim a nonrefundable credit of $2,500 for each entry-level energy-efficient home and $1,875 for each move-up energy-efficient home. These credit amounts will be adjusted annually for inflation starting in 2027. The bill clarifies that either the eligible contractor or the purchaser can claim the credit, but not both, and sets a maximum annual credit claim of $500,000 for contractors who haven't fully transferred their credits. Importantly, the total amount of credits allowed statewide is capped at $10 million per taxable year, and credits will be allocated on a pro rata basis. The bill also mandates that the Tax Commissioner, in consultation with the Department of Energy, will develop guidelines for claiming these credits and will publish an annual report detailing the credits claimed, without disclosing taxpayer information.

Budget and Finance

https://lis.virginia.gov/bill-details/20261/HB760