Introduction: A Crisis of Construction Waste
The United States produces over 600 million tons of construction and demolition debris annually—the single largest waste stream in the nation. According to the EPA, demolition accounts for more than 90 percent of this staggering figure. In Colorado alone, an estimated one-third of all landfill waste originates from the construction and demolition industry. Yet remarkably, up to 90 percent of these discarded materials could be reused or recycled through a process known as deconstruction.
As cities from Boulder to Pittsburgh implement ordinances requiring contractors to “deconstruct” old buildings instead of demolishing them the traditional way, a growing ecosystem of deconstruction contractors, nonprofits, and reuse centers has emerged to transform what was once waste into valuable resources. Part of this valuation includes donating the materials to charity for a tax deduction at the IRS strictly defined Fair Market Value, resulting in significant tax deductions for property owners.
What Is Deconstruction?
Deconstruction is the systematic dismantling and removal of a structure, essentially “un-building” in reverse order of construction, with the goal of salvaging materials for reuse and recycling. Unlike traditional demolition, which uses bulldozers and wrecking balls to quickly clear a site, deconstruction involves careful disassembly that preserves the value and integrity of building components.
As Anna Perks of Perks Deconstruction in Colorado notes, “In the deconstruction world, we talk a lot about how we recycle cans but then we throw away entire houses.” Her company, along with others nationwide, specializes in taking apart buildings piece-by-piece, achieving reuse and recycling rates of 75 percent or higher.
Materials commonly recovered through deconstruction include: structural lumber and dimensional framing, hardwood flooring, cabinetry and millwork, doors and windows, HVAC equipment, plumbing fixtures, appliances, architectural salvage elements, brick and masonry, and roofing materials. The Parsons Healthy Materials Lab reports that in New York alone, 58 percent of construction and demolition materials are discarded annually—yet 90 percent could be reused or recycled through deconstruction practices.
Our team works on at least 1-3 projects a week on deconstruction and donation in New York alone.
The Deconstruction Process: Step by Step
Phase 1: Pre-Deconstruction Assessment
Every successful deconstruction project begins with a comprehensive salvage survey. Organizations like Dave Benninck and his team, Building Value in Cincinnati, Finger Lakes ReUse in New York, Recyclean, Habitat Omaha, Deconstruction Works, Resource Central in Colorado, and a host of others perform detailed assessments to identify and inventory salvageable materials. This audit helps determine the quantity and range of materials that can be recovered, their potential resale value, and the overall feasibility of deconstruction versus demolition.
Currently, structurally sound buildings with wood-frame or brick construction are most suitable for deconstruction. However, partial deconstruction remains a viable option when full disassembly is not feasible, still significantly reducing waste compared to traditional demolition.
Our work as valuators often includes facades from commercial buildings, corporate office decommissions to include furniture, fixtures, lighting, appliances, and industrial machinery, as well as the more traditional materials such as lumber, doors, and windows.
Phase 2: Interior Deconstruction
The deconstruction process typically begins inside the structure. Crews systematically remove reusable components including cabinetry, doors, appliances, fixtures, flooring, and HVAC equipment. Items in good condition are set aside for donation to nonprofit reuse centers such as Habitat for Humanity ReStores, Building Value, Big Reuse in Brooklyn, or local architectural salvage organizations.
Materials that cannot currently be reused but can be recycled—such as scrap metal, certain types of insulation, and ductwork—are separated for processing. Unfortunately, some materials like drywall, plaster, and vinyl flooring lack reuse or recycling markets and must still be landfilled, though the industry continues working to find solutions.
Phase 3: Structural Deconstruction
Once the interior is gutted, crews begin the careful work of “un-building” the structure itself. According to Perks Deconstruction, it takes approximately 41 trees to build an average house—making lumber recovery particularly valuable. Wood is de-nailed and processed for resale as reclaimed lumber, a product highly sought after by woodworkers and sustainable builders.
Deconstruction Works in Vermont describes sorting materials into distinct categories: reusable fixtures destined for resale, lumber for processing and reuse, scrap metal for recycling, scrap wood for mulching, and brick or masonry for crushing and recycling. Only materials without current reuse or recycling options go to landfill.
For full house deconstruction projects, typical teams consist of four to five workers, with timelines ranging from 10 to 20 days depending on structure size and complexity. Deconstruction costs typically run $8 to $14+ per square foot—often no more than 30 percent above traditional demolition costs.
The Critical Role of Material Donation
The economic viability of deconstruction often hinges on the tax benefits available to property owners who donate salvaged materials to qualified nonprofit organizations. When materials are donated to 501(c)(3) organizations or governmental entities, property owners may claim a charitable contribution deduction equal to the IRS defined Fair Market Value of the donated items.
This deduction is critical to the entire reuse ecosystem. In our over six years of experience at The Green Mission Inc., over 90 percent of clients choose deconstruction over demolition specifically because the tax deduction helps bridge the cost differential between the two approaches. As Building Value notes, “Only a tax professional can determine if you qualify for a tax deduction from deconstruction services. An estimate of value from a qualified appraiser is required.”
The donation process involves several key steps. First, the property owner identifies a qualified donee organization—typically a nonprofit reuse center or governmental entity with an environmental mission. The deconstruction contractor works with the nonprofit to coordinate material removal and acceptance. The nonprofit provides a detailed receipt documenting all materials received.
Where Qualified Appraisers Enter the Picture
For donations valued at $5,000 or more, the IRS requires a “Qualified Appraisal” prepared by a “Qualified Appraiser” to substantiate the charitable contribution deduction. This is where our work at The Green Mission Inc. becomes essential to the deconstruction process.
Understanding the Appraisal Requirement
A critical distinction must be understood: when building materials are detached from real property, they immediately become personal property. The value of an intact real property structure is almost always significantly higher than its detached personal property components. A real estate appraisal values land, improvements, and associated rights—but deconstructed materials are no longer real property and cannot be valued as such.
This principle was definitively established in the landmark Mann v. United States case, where the federal court of appeals set important precedent regarding how deconstructed and donated building materials should be valued. The court rejected appraisals that treated detached materials as if they retained their value as intact improvements, noting that “a proper way” to value such donations is “based on the resale value of the specific building materials and contents” that were actually removed and donated.
The Qualified Appraiser Standard
Unlike certified public accountants, attorneys, or real estate appraisers, personal property appraisers currently lack rigorous federal or state licensure requirements. This has historically allowed individuals without adequate education or experience to produce appraisals in this space, sometimes resulting in inflated valuations that jeopardize taxpayers’ deductions and harm the reputation of the entire industry.
To be considered a Qualified Appraiser for IRS purposes, an individual must have earned a recognized appraisal designation from a professional appraiser organization or have equivalent education and training—typically through organizations such as the American Society of Appraisers (ASA), International Society of Appraisers (ISA), or Appraisers Association of America (AAA). The appraiser must demonstrate experience in valuing the specific type of property at issue and must not have been prohibited from practicing before the IRS.
Our Approach at The Green Mission Inc.
The Green Mission Inc. leverages deep understanding of the tax code to specialize in waste diversion strategies, producing IRS-qualified and USPAP-compliant personal property donation appraisals. Our appraisal valuation methodology is based upon the Sales Comparison Approach—valuing materials based on actual market data from the relevant secondary retail market rather than theoretical construction costs, which is used for the vast majority of personal property appraisals.
Our process begins with determining the scope of the potential donation with the client and providing an initial estimated value range at no cost. This preliminary estimate draws on our proprietary database of comparable sales data, giving clients transparency and allowing them to make informed decisions about deconstruction versus demolition.
Once the client proceeds, we coordinate with the deconstruction contractor and nonprofit recipient to ensure accurate inventory documentation. Our detailed appraisal research begins only after receiving complete documentation from the donee, ensuring the appraisal reflects only materials that were actually accepted. This careful sequencing prevents the inclusion of materials that were never donated—a compliance issue that has resulted in disallowed deductions in cases like Loube v. Commissioner and Chirelli v. Commissioner.
Environmental and Economic Impact
The impact of deconstruction extends far beyond individual tax deductions. Since implementing its deconstruction ordinance, Boulder has approved 45 to 60 deconstruction projects every year. Resource Central in Boulder reports diverting more than five million pounds of materials from landfills in a single year. Building Value in Cincinnati has provided deconstruction services for over 20 years, supporting both environmental sustainability and workforce development. Recyclean in the Upper Midwest, Building Futures Minnesota in the Twin Cities, Deconstruction Works in Vermont, and Sustainability Angels in New York have hears of expertise and experience in the field.
According to Colorado Demolition & Deconstruction, deconstruction creates six to eight jobs for every one created by traditional demolition. Big Reuse in Brooklyn recovered 1,574,056 pounds of materials in 2023, equivalent to 1,685 metric tons of avoided carbon emissions.
Emily Freeman, policy advisor for circular economy in Boulder, emphasizes the connection to broader environmental challenges: “We’re losing our forests. We’re losing that carbon sink. If we can find ways that we can preserve building materials that have been already extracted from our environment and we can reincorporate that into new designs, we can help save our forests.”
Looking Forward: The Growth of Deconstruction Policy
Deconstruction ordinances are spreading across the country. Pittsburgh adopted its ordinance in 2021. San Antonio followed with requirements mandating that certain structures be deconstructed rather than demolished. Portland, Oregon; Milwaukee, Wisconsin; and Palo Alto, California have all implemented some form of deconstruction requirements.
Research from Cornell University’s Circular Construction Lab provides detailed analysis of these ordinances and their potential to build toward a more circular economic model. As the Boston Preservation Alliance has noted, deconstruction ordinances are policy tools that help reduce waste while preserving valuable resources that would otherwise be destroyed.
For property owners considering renovation or demolition, the message is clear: before reaching for the wrecking ball, consider deconstruction. With proper planning, qualified contractors, appropriate nonprofit partners, and a qualified appraiser to document fair market value, you can divert materials from landfills, support your community, and potentially realize significant tax benefits in the process.
Conclusion
The deconstruction industry represents a rare alignment of environmental responsibility and sound tax policy. By carefully dismantling structures and donating salvageable materials to qualified nonprofits, property owners support the circular economy while potentially offsetting deconstruction costs through legitimate tax deductions.
However, these deductions must be properly substantiated. The IRS has been clear about what is required: qualified appraisals by qualified appraisers, accurate documentation of materials actually donated, and valuations based on real market data rather than theoretical construction costs. When these requirements are met, the tax deduction for deconstruction donations remains a powerful incentive for sustainable building practices.
At The Green Mission Inc., we are committed to maintaining the highest standards in this space—ensuring that our appraisals withstand IRS scrutiny while supporting clients in their efforts to choose sustainability over demolition. The stakes are too high, both environmentally and financially, for anything less.
About the Author
Jessica I. Marschall, CPA, ISA AM is a certified public accountant with 26 years of experience and an IRS Qualified Appraiser specializing in personal property and deconstruction appraisals. She serves as President and CEO of four companies: The Green Mission Inc., a nationally recognized deconstruction appraisal firm; GM-ESG, providing corporate decommissioning services with ESG reporting and valuation consulting; Probity Appraisal Group, specializing in art, antiques, collectibles, and intangible asset valuations; and MAS LLC, a tax advisory and small business valuation practice.
Since founding The Green Mission Inc. in 2019, Jessica has built the firm into an industry leader, currently serving approximately 1,000 clients annually. Her unique combination of deep tax expertise and personal property appraisal credentials allows her to bridge the gap between IRS compliance requirements and sustainable building practices.
Jessica holds an Accredited Member (AM) designation from the International Society of Appraisers and has completed comprehensive personal property education through the American Society of Appraisers, International Society of Appraisers, and the Appraisers Association of America’s CASP training program. She has accumulated over 400 hours of continuing education in appraisal methodology, tax law, and valuation practices.
A prolific educator and author, Jessica has written over 150 articles on tax, valuation, and non-cash charitable contribution subjects. She regularly presents webinars and seminars on advanced tax topics including Opportunity Zones, Section 351 asset transfers, and charitable contribution substantiation requirements. She has presented on deconstruction appraisals at conferences.
Jessica is qualified to teach and regularly delivers CPE credit courses in advanced tax and appraisal subjects. She serves as a Board Member and Treasurer of the Stafford Educational Foundation and has been involved with Rethos’s Board for three years, furthering her commitment to sustainable practices and community development.
Through her work with The Green Mission Inc. and GM-ESG, Jessica partners with builders, developers, demolition contractors, deconstruction contractors, and nonprofit organizations across the country to ensure that tax deductions for deconstructed materials are accurately documented, properly valued, and fully compliant with IRS requirements—protecting both taxpayers and the integrity of the sustainable building movement.
Sources
Building Value. “Deconstruction Services.” buildingvalue.org
Colorado Demolition & Deconstruction. “House Deconstruction.” coloradodemolition.com
Deconstruction Works. deconstructionworks.com
Finger Lakes ReUse. “Deconstruction Services.” ithacareuse.org
Healthy Materials Lab, Parsons School of Design. “From Demolition to Deconstruction: A Path Toward Circularity.” healthymaterialslab.org, February 2025
O’Dowd, Peter. “Cities forgo wrecking balls and order ‘deconstruction’ of old buildings, instead.” WBUR/Here & Now, January 29, 2025
Perks Deconstruction. “The House Deconstruction Process.” perksdeconstruction.com
Resource Central. “Deconstruction vs. Demolition.” resourcecentral.org
The Green Mission Inc. Various articles on deconstruction appraisals, tax compliance, and personal property valuation. thegreenmissioninc.com
Augustine-Marceil, Wyeth. “Which Buildings are ‘Worth’ Disassembling? An Analysis of American Deconstruction Ordinances.” Cornell University, cited by Boston Preservation Alliance