An official website of the United States government.

This is not the current EPA website. To navigate to the current EPA website, please go to This website is historical material reflecting the EPA website as it existed on January 19, 2021. This website is no longer updated and links to external websites and some internal pages may not work. More information »


Brownfields Tax Incentive

NOTE: The Federal Brownfields Tax Incentive sunset on December 31, 2011. Congress has not renewed the Brownfields Tax Incentive. Therefore, the tax incentive cannot be claimed for tax years beyond 2011.

Originally signed into law in 1997 and extended through December 31, 2011, the Brownfields Tax Incentive encourages the cleanup and reuse of brownfields. Under the Brownfields Tax Incentive, environmental cleanup costs are fully deductible in the year incurred, rather than capitalized and spread over time. Improvements in 2006 expanded the tax incentive to include petroleum cleanup.

A Guide to Federal Tax Incentives for Brownfields Redevelopment

The success of many Brownfields cleanup and redevelopment projects depends on the ability of developers and investors to craft a financing package that leverages numerous sources of funding available from a variety of sources. Taking advantage of federal, state and local tax incentives and credits allows a Brownfields developer to use resources normally spent to pay taxes for other purposes. This can help site redevelopers save the cash needed to address contamination issues. The extra cash flow resulting from a tax break also can improve a project’s appeal to lenders. Federal tax credits and incentives often are an important part of the mix.

Excerpt from P.L. 111-312 The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010


(a) IN GENERAL.—Subsection (h) of section 198 is amended by striking “December 31, 2009” and inserting "December 31, 2011".

(b) EFFECTIVE DATE.—The amendment made by this section shall apply to expenditures paid or incurred after December 31, 2009.

The following guide provides an overview of the key federal tax incentives and credits that can be leveraged for Brownfields cleanup, redevelopment and reuse.