HOUSE BILL NO. 5389

October 13, 2021, Introduced by Reps. Sowerby, Haadsma, Cherry, Clemente, Camilleri, Pohutsky, Kuppa, Hope, Koleszar and Brabec and referred to the Committee on Tax Policy.

A bill to amend 1967 PA 281, entitled

"Income tax act of 1967,"

(MCL 206.1 to 206.713) by adding section 279.

the people of the state of michigan enact:

Sec. 279. (1) Subject to the limitations under this section, for tax years that begin on and after January 1, 2021, a taxpayer that purchases a qualified green residential building during the tax year or that invests in an eligible renovation or addition to an existing residential building that is completed during the tax year may claim a credit against the tax imposed by this part as follows:

(a) For the purchase of a qualified green residential building, $5,000.00.

(b) For an eligible renovation or addition to an existing residential building with the following certification:

(i) A platinum LEED certification, platinum GreenStar certification, emerald NGBS green certification, living building certification, or Zero Energy Ready Home certification, 30% of the costs incurred to complete that eligible renovation or addition or $4,000.00, whichever is less.

(ii) A gold LEED certification, gold GreenStar certification, or gold NGBS green certification, 30% of the costs incurred to complete the eligible renovation or addition or $3,000.00, whichever is less.

(iii) A silver LEED certification, silver GreenStar certification, or silver NGBS green certification, 30% of the costs incurred to complete the eligible renovation or addition or $2,000.00, whichever is less.

(2) A taxpayer shall not claim a credit under this section unless a certificate has been issued to the taxpayer for the qualified green residential building or the eligible renovation or addition. The taxpayer shall attach the certificate to the annual return filed under this part on which the credit under this section is claimed. The certificate required under this subsection shall state, at a minimum, that the qualified green residential building or the eligible renovation or addition, whichever is applicable, meets or exceeds the certification standards of that certifying body.

(3) If the credit allowed under this section for the tax year and any unused carryforward of the credit allowed by this section exceed the taxpayer's tax liability for the tax year, that portion that exceeds the tax liability for the tax year shall not be refunded but may be carried forward to offset tax liability in subsequent tax years for 4 years or until used up, whichever occurs first.

(4) As used in this section:

(a) "Eligible renovation or addition" means a renovation or addition made to an existing residential building that is located in this state, that is renovated or constructed by a person licensed under article 24 of the occupational code, 1980 PA 299, MCL 339.2401 to 339.2412, that was issued a building permit for the renovation or addition as required under the Stille-DeRossett-Hale single state construction code act, 1972 PA 230, MCL 125.1501 to 125.1531, and that eligible renovation or addition to the existing residential building has been certified by any of the following:

(i) The United States Green Building Council under the LEED program.

(ii) The Home Innovation Research Labs under the NGBS green certification program.

(iii) The GreenHome Institute under the greenstar certification program.

(iv) The United States Department of Energy under the Zero Energy Ready Home program.

(v) The International Living Future Institute under the living building challenge program.

(b) "GreenStar certification" means the certification awarded by the GreenHome Institute.

(c) "LEED" means leadership in energy and environmental design.

(d) "LEED certification" means the certification awarded by the United States Green Building Council based on the most recent LEED green building rating system developed and adopted by the United States Green Building Council for new buildings and major renovations.

(e) "NGBS" means national green building standard.

(f) "NGBS green certification" means the certification awarded by the Home Innovation Research Labs.

(g) "Qualified green residential building" means a newly constructed residential building that is located in this state, that is constructed by a person licensed under article 24 of the occupational code, 1980 PA 299, MCL 339.2401 to 339.2412, that is constructed or renovated in accordance with the Michigan building code or the Michigan rehabilitation code for existing buildings as promulgated pursuant to the Stille-DeRossett-Hale single state construction code act, 1972 PA 230, MCL 125.1501 to 125.1531, and that has a platinum LEED certification, platinum GreenStar certification, emerald NGBS green certification, living building certification from the International Living Future Institute, or Zero Energy Ready Home certification from the United States Department of Energy.

(h) "Residential building" means any 1- and 2-family dwelling, townhouse, or accessory structure that is regulated by the Michigan residential code promulgated pursuant to the Stille-DeRossett-Hale single state construction code act, 1972 PA 230, MCL 125.1501 to 125.1531.