Tax credit changes coming

[begreen]

The IRS has proposed to adopt the EPA database to “provide uniformity and simplicity.” Comments are due by Dec. 24 and there is a public hearing on Jan.21, the day after the inauguration. If adopted, as expected, several manufacturers will have to change their claims about eligibility for the $2,000 tax credit.

 

[EbS-P]

Who else besides SBI will it affect? What piece of legislation was this tax credit in and will it fly under the radar unlike other green subsidies? The impacts of loosing the whole tax credit I think would be noticeable. I don’t think this change will have much impact on the industry.

 

[Trevor Tahclep]

How much are the tax credits/rebates etc. in the USA, the fed or provincial governments here do not offer such programs here on wood fired appliances.

 

[MRD1985]

Will this affect the rebate of the SBI stove I installed in January of 24 and plan on filing for a rebate in the upcoming tax season, or is this just from 2025 moving forward?

 

[weee123]

Will this affect the rebate of the SBI stove I installed in January of 24 and plan on filing for a rebate in the upcoming tax season, or is this just from 2025 moving forward?

I would assume it would start with the 2025 tax year so when you file in 2026. I could be mistaken though.

 

[Eman85]

Ask Elon.

 

[EbS-P]

Will this affect the rebate of the SBI stove I installed in

One would think it’s too lake to make changes to tax year 2024 as they should start accepting returns in January but……

Ask Elon.

 

[begreen]

Who else besides SBI will it affect? What piece of legislation was this tax credit in and will it fly under the radar unlike other green subsidies? The impacts of loosing the whole tax credit I think would be noticeable. I don’t think this change will have much impact on the industry.

Enerco has been bending this rule too in their Master Forge/Cleveland Iron Works/Grand Teton, etc. brands. US Stove has also made these claims while not being on the EPA 75%+ list.

 

[Todd]

Just about every stove out there would qualify if they didn’t have to average in the high burn rate runs. Most people burn their stoves at the low or medium burn rates and that’s where they are most efficient. I think manufacturers are cherry picking these higher efficiency numbers instead of the overall averages?

 

[BKVP]

The changes will be a bit more extensive. First, as @begreen noted, only the stoves listed at 75% or higher on the EPA list will qualify.

Then manufacturers will have to obtain from the IRS in Q1 of 2025 a Qualified Manufacturer No. Working with IRS to address how manufacturers will obtain this number as it requires specific US business numbers.

Manufacturers will also begin assigning a specific pin number to each and every stove in 2025. Tax payers will need that Pin Number in 2026 when filing taxes using the credit. The IRS is requiring this 17 digit pin for every product that qualifies (stoves, doors, windows etc).

Moving forward the industry will be including pin numbers (where they are to be located is not called out in legislation other than to say "not on packaging". Likely a label on the back or with the Owners Manual.

Not more is know so once the NOPR is completed with the comment period, specifics will be known.

BKVP

 

[stoveliker]

I wonder if the IRS saw more tax credit claims than would be expected based on qualifying stove sales and that's why the pin is introduced...

 

[MRD1985]

The changes will be a bit more extensive. First, as @begreen noted, only the stoves listed at 75% or higher on the EPA list will qualify.

Then manufacturers will have to obtain from the IRS in Q1 of 2025 a Qualified Manufacturer No. Working with IRS to address how manufacturers will obtain this number as it requires specific US business numbers.

Manufacturers will also begin assigning a specific pin number to each and every stove in 2025. Tax payers will need that Pin Number in 2026 when filing taxes using the credit. The IRS is requiring this 17 digit pin for every product that qualifies (stoves, doors, windows etc).

Moving forward the industry will be including pin numbers (where they are to be located is not called out in legislation other than to say "not on packaging". Likely a label on the back or with the Owners Manual.

Not more is know so once the NOPR is completed with the comment period, specifics will be known.

BKVP

I assume stoves installed in 2024 would not be subject to these new changes?

 

[BKVP]

I assume stoves installed in 2024 would not be subject to these new changes?

That is a great question. I am no tax expert, but a few things to consider.

1) Legislation did NOT specify 75% HHV OVERALL. It just stated 75% HHV. Several mfg's sent inquiries in 2023 and 2024 to the IRS seeking clarification and received no response. I also believe the industry trade association also sought the clarification.

2) Can the IRS audit tax records, sure. However, consumers should have downloaded certificate of compliance from mfg websites. They are required to have these as part of their records. Likely, that would serve as evidence of compliance.

3) The web and this site are not the best way to seek 100% affirmation to tax credit questions. Those rest with qualified tax professionals.

4) Let's wait and see what January 21 public hearing does to address all these issues.

BKVP