IRS Issues Proposed Rule for Product ID Requirements for 25C Tax Credit-Eligible Products

The Internal Revenue Service (IRS) has issued a proposed rule on product identification numbers (PINs) for 25C tax credit-eligible windows, doors and skylights (and other products) as required by the Inflation Reduction Act (IRA). 

The IRA modified and extended the 25C tax credit for energy-efficient windows, doors and skylights. Beginning in 2023, the new 25C tax credit only applies to windows and skylights that meet ENERGY STAR’s Most Efficient standards, while exterior doors remain eligible under regular ENERGY STAR standards. The new tax credit provides up to $600 for windows and skylights that meet ENERGY STAR’s Most Efficient standards, while the credit for exterior doors offers $250 per door up to $500 for those that meet regular ENERGY STAR standards.

Eligibility for the 25C tax credit was also made more complicated by a new requirement that all qualified windows, doors and skylights be assigned a unique PIN that can be reported on consumer tax returns and verified by the IRS beginning in 2025. This is ostensibly to address unfounded tax fraud issues. The IRS has finally issued the proposed rule for the PIN requirement.

WDMA had strongly encouraged the IRS to delay implementation of the PIN requirements until 2026, which the agency is largely doing with exceptions. WDMA will be submitting comments on the proposed rule by the comment deadline, which is expected by the end of the year. WDMA members with feedback should contact Michael Pierce at [email protected].

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