8908 Instructions for Form 8908

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Instructions for Form 8908

Department of the Treasury
Internal Revenue Service

(Rev. December 2023)

Energy Efficient Home Credit
Section references are to the Internal Revenue Code
unless otherwise noted.

A qualified new energy efficient home that is a
manufactured home may be acquired directly or indirectly
from an eligible contractor. A qualified new energy efficient
home that is a manufactured home is acquired indirectly
from an eligible contractor for use as a residence if the
person that produced the manufactured home sells it to an
intermediary (for example, a dealer of manufactured
homes) and the intermediary (or the last of multiple
intermediaries) sells or leases the manufactured home to
another person for use as a residence. See section 7.03
of Notice 2023-65 for a safe harbor permitting an eligible
contractor to rely on a dealer's statement concerning a
sale by the dealer of manufactured homes.

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General Instructions

Future Developments

For the latest information about developments related to
Form 8908 and its instructions, such as legislation
enacted after they were published, go to IRS.gov/
Form8908.

What’s New

Credit increase and modification. The Inflation
Reduction Act of 2022 increased and modified the credit
for certain homes sold or leased after 2022.

Purpose of Form

Eligible contractors use Form 8908 to claim a credit for
each qualified new energy efficient home sold or leased to
another person during the tax year for use as a residence.
The credit is based on the energy saving requirements of
the home. The credit is part of the general business credit.

Partnerships and S corporations must file this form to
claim the credit. All other taxpayers aren’t required to
complete or file this form if their only source for this credit
is a partnership or an S corporation. Instead, they can
report this credit directly on line 1p in Part III of Form 3800,
General Business Credit.
For more information, see section 45L and Notice
2023-65, 2023-42 I.R.B. 1067, available at IRS.gov/irb/
2023-42_IRB#NOT-2023-65.

Which Revision To Use

Use the December 2023 revision of Form 8908 for tax
years beginning in 2023 or later, until a later revision is
issued. Use prior revisions of the form and instructions for
earlier tax years. All revisions are available at IRS.gov/
Form8908.

Who May Claim the Credit

An eligible contractor may claim the credit for a qualified
new energy efficient home that is acquired by an individual
from that contractor during the tax year for use as a
residence.

Definitions
Acquired

The term "acquired" includes purchased. Also, a qualified
new energy efficient home that is leased by a person from
an eligible contractor for use as a residence during the tax
year is considered acquired. A qualified new energy
efficient home is not acquired by a person from an eligible
contractor if the eligible contractor retains the home for
use as a residence.
Dec 12, 2023

Eligible Contractor

An eligible contractor is the person that constructed the
qualified new energy efficient home and owned and had a
basis in the home during its construction, or, in the case of
a qualified new energy efficient home that is a
manufactured home, the person that produced the home
and owned and had a basis in the home during its
production. For example, if a person that owns and has a
basis in a qualified new energy efficient home during its
construction hires a third-party contractor to construct the
home, the person that hires the third-party contractor is
the eligible contractor and the third-party contractor isn't
an eligible contractor.

Qualified New Energy Efficient Home

A qualified new energy efficient home is a dwelling unit
located in the United States, whose construction is
substantially completed after August 8, 2005, and sold or
leased to another person before 2033, for use as a
residence. The home must be certified and meet certain
energy saving requirements. Construction includes
substantial reconstruction and rehabilitation.
The term “United States” includes all 50 states and the
District of Columbia. The term does not include U.S.
territories.

Energy Saving Requirements

To meet the energy saving requirements, a qualified new
energy efficient home must be eligible to participate in one
of the following Energy Star programs.
• The Energy Star Residential New Construction
Program.
• The Energy Star Manufactured New Homes Program.
• The Energy Star Multifamily New Construction
Program.
For more information about these programs, see the
Energy Star Program Requirements webpage at
www.energystar.gov/partner_resources/residential_new/
program_reqs.

Cat. No. 66390D

The credit amount is based on the extent to which each
qualified new energy efficient home meets the energy
saving requirements discussed below.
Zero energy ready home. A zero energy ready home is
a dwelling unit certified as a zero energy ready home
under the Zero Energy Ready Home (ZERH) Program of
the Department of Energy as in effect on January 1, 2023
(or any successor program determined by the Secretary of
the Treasury). See section 4.04(2) of Notice 2023-65 for
more information about the ZERH program in effect and
the determination of any successor program.
Information about this program is available at
www.energy.gov/eere/buildings/doe-zero-energy-readyhome-zerh-program-requirements.

• The Energy Star Multifamily New Construction Regional
Program Requirements in effect on January 1, 2023,
which are applicable to the location of the dwelling unit.
A dwelling unit certified under a currently effective
version of one of the Energy Star Multifamily Home
Program Requirements by definition is also certified under
any prior version of the same program requirements. For
example, a dwelling unit certified under the Energy Star
Multifamily New Construction National Program
Requirements 1.2 is also considered certified under the
Energy Star Multifamily New Construction National
Program Requirements 1.1.
The EPA will deem a dwelling unit certified under
certain Energy Star Multifamily New Construction National
Program Requirements to also be certified under certain
Energy Star Multifamily New Construction Regional
Program Requirements, and vice versa. To determine
which deemed certifications correspond to which Energy
Star program requirements, see the Energy Star webpage
(address provided below).
If the dwelling unit is not located in California, Florida,
Hawaii, Oregon, or Washington, then the most recent
Energy Star Multifamily New Construction Program
Requirements applicable to the location of the dwelling
unit will be the effective Energy Star Multifamily New
Construction National Program Requirements.
For more information, see the Energy Star webpage at
www.energystar.gov/about/federal_tax_credits/
federal_tax_credit_archives/tax_credits_home_builders.
Prevailing wage requirements for multifamily
homes. The prevailing wage requirements with respect to
any qualifying residence are that the eligible contractor
must ensure that any laborers and mechanics employed
by the eligible contractor or any subcontractor in the
construction of such residence are paid wages at rates not
less than the prevailing rates for construction, alteration, or
repair of a similar character in the locality in which such
residence is located as most recently determined by the
Secretary of Labor.
For more information, see the following.
• For initial guidance, see Notice 2022-61, 2022-52 I.R.B.
560, available at IRS.gov/irb/2022-52_IRB#NOT-2022-61.
• Proposed regulations are in Internal Revenue Bulletin
2023-39, available at IRS.gov/irb/
2023-39_IRB#REG-100908-23.
• Any future guidance provided by final regulations will be
covered as discussed under Future Developments, earlier.
.

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Single-family home requirements (Energy Star Single-Family Home Program Requirements). A dwelling
unit eligible to participate in the Energy Star Residential
New Construction Program or the Energy Star
Manufactured New Homes Program meets these
requirements if the dwelling unit meets:
• The Energy Star Single-Family New Homes National
Program Requirements 3.1; and
• The Energy Star Single-Family New Homes Program
Requirements in effect on January 1, 2023, which are
applicable to the location of the dwelling unit; or
• The Energy Star Manufactured Home National Program
Requirements in effect on January 1, 2023.
A dwelling unit certified under a currently effective
version of one of the Energy Star Single-Family Home
Program Requirements by definition is also certified under
any prior version of the same program requirements. For
example, a dwelling unit certified under the Energy Star
Single-Family New Homes National Program
Requirements 3.2 is also considered certified under the
Energy Star Single-Family New Homes National Program
Requirements 3.1.
The Environmental Protection Agency (EPA) will deem
a dwelling unit certified under certain Energy Star
Single-Family New Homes National Program
Requirements to also be certified under certain Energy
Star Single-Family New Homes Regional Program
Requirements, and vice versa. To determine which
deemed certifications correspond to which Energy Star
program requirements, see the Energy Star webpage
(address provided below).
If a dwelling unit is not located in California, Florida,
Hawaii, Oregon, or Washington, then the most recent
Energy Star Single-Family New Homes Program
Requirements applicable to the location of the dwelling
unit will be the effective Energy Star Single-Family New
Homes National Program Requirements.
For more information, see the Energy Star webpage at
www.energystar.gov/about/federal_tax_credits/
federal_tax_credit_archives/tax_credits_home_builders.
Multifamily home requirements (Energy Star Multifamily Home Program Requirements). A dwelling unit
eligible to participate in the Energy Star Multifamily New
Construction Program meets these requirements if the
dwelling unit meets:
• The Energy Star Multifamily New Construction National
Program Requirements in effect on January 1, 2023; and
2

Certification

An eligible contractor must obtain any certification(s) the
dwelling unit needs to meet the applicable program
requirement(s) referred to in section 45L(c) before
claiming the energy efficient home credit. These program
requirements are discussed earlier. Certification
information is available on the referenced websites.

Instructions for Form 8908 (Rev. December 2023)

Specific Instructions
Line 1

The credit is $2,500 for each home sold or leased after
2022 and eligible to participate in the:
• Energy Star Residential New Construction Program that
meets the single-family home requirements but is not
certified as a zero energy ready home, or
• Energy Star Manufactured New Homes Program that
meets the single-family home requirements but is not
certified as a zero energy ready home.

Multifamily New Construction Program that meets the
prevailing wage requirements and is certified as a zero
energy ready home.
Generally, you must reduce the expenses incurred in
the construction of each new home by the amount of the
credit when figuring your basis in the property. However,
do not reduce the expenses by the amount of the credit
when figuring the adjusted basis of a building for purposes
of the low-income housing credit. Also, expenses taken
into account for either the rehabilitation credit or the
energy credit part of the investment tax credit must not be
taken into account when figuring the energy efficient home
credit. See sections 45L(e) and (f).

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Generally, you must reduce the expenses incurred in
the construction of each new home by the amount of the
credit when figuring your basis in the property. However,
do not reduce the expenses by the amount of the credit
when figuring the adjusted basis of a building for purposes
of the low-income housing credit. Also, expenses taken
into account for either the rehabilitation credit or the
energy credit part of the investment tax credit must not be
taken into account when figuring the energy efficient home
credit. See sections 45L(e) and (f).

Line 2

The credit is $5,000 for each home sold or leased after
2022 and eligible to participate in the:
• Energy Star Residential New Construction Program and
is certified as a zero energy ready home, or
• Energy Star Manufactured New Homes Program and is
certified as a zero energy ready home.

Generally, you must reduce the expenses incurred in
the construction of each new home by the amount of the
credit when figuring your basis in the property. However,
do not reduce the expenses by the amount of the credit
when figuring the adjusted basis of a building for purposes
of the low-income housing credit. Also, expenses taken
into account for either the rehabilitation credit or the
energy credit part of the investment tax credit must not be
taken into account when figuring the energy efficient home
credit. See sections 45L(e) and (f).

Line 3

The credit is $2,500 for each home sold or leased after
2022 and eligible to participate in the Energy Star
Multifamily New Construction Program that meets the
prevailing wage requirements and the multifamily home
requirements but is not certified as a zero energy ready
home.
Generally, you must reduce the expenses incurred in
the construction of each new home by the amount of the
credit when figuring your basis in the property. However,
do not reduce the expenses by the amount of the credit
when figuring the adjusted basis of a building for purposes
of the low-income housing credit. Also, expenses taken
into account for either the rehabilitation credit or the
energy credit part of the investment tax credit must not be
taken into account when figuring the energy efficient home
credit. See sections 45L(e) and (f).

Line 4

The credit is $5,000 for each home sold or leased after
2022 and eligible to participate in the Energy Star
Instructions for Form 8908 (Rev. December 2023)

Line 5

The credit is $500 for each home sold or leased after 2022
and eligible to participate in the Energy Star Multifamily
New Construction Program that meets the multifamily
home requirements but is not certified as a zero energy
ready home and does not meet the prevailing wage
requirements.

Generally, you must reduce the expenses incurred in
the construction of each new home by the amount of the
credit when figuring your basis in the property. However,
do not reduce the expenses by the amount of the credit
when figuring the adjusted basis of a building for purposes
of the low-income housing credit. Also, expenses taken
into account for either the rehabilitation credit or the
energy credit part of the investment tax credit must not be
taken into account when figuring the energy efficient home
credit. See sections 45L(e) and (f).

Line 6

The credit is $1,000 for each home sold or leased after
2022 and eligible to participate in the Energy Star
Multifamily New Construction Program that is certified as
a zero energy ready home but does not meet the
prevailing wage requirements.
Generally, you must reduce the expenses incurred in
the construction of each new home by the amount of the
credit when figuring your basis in the property. However,
do not reduce the expenses by the amount of the credit
when figuring the adjusted basis of a building for purposes
of the low-income housing credit. Also, expenses taken
into account for either the rehabilitation credit or the
energy credit part of the investment tax credit must not be
taken into account when figuring the energy efficient home
credit. See sections 45L(e) and (f).

Line 7

Enter total energy efficient home credits from:
• Schedule K-1 (Form 1065), Partner’s Share of Income,
Deductions, Credits, etc., box 15 (code AM); and
• Schedule K-1 (Form 1120-S), Shareholder’s Share of
Income, Deductions, Credits, etc., box 13 (code AM).
Partnerships and S corporations report the above
credits on line 7. All other filers figuring a separate credit
on earlier lines also report the above credits on line 7. All
others not using earlier lines to figure a separate credit
can report the above credits directly on Form 3800, Part
III, line 1p.
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The time needed to complete and file this form will vary depending on individual circumstances. The estimated burden
for individual and business taxpayers filing this form is approved under OMB control number 1545-0074 and 1545-0123
and is included in the estimates shown in the instructions for their individual and business income tax return. The
estimated burden for all other taxpayers who file this form is shown below.
Recordkeeping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Learning about the law or the form. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Preparing and sending the form to the IRS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2 hr., 9 min.
12 min.
14 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler,
we would be happy to hear from you. See the instructions for the tax return with which this form is filed.

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Instructions for Form 8908 (Rev. December 2023)