IRS Rules that Homeowners Won’t Have to Pay Additional Taxes for Subsidized Replacement of Lead Pipes
Milwaukee, WI – The Internal Revenue Service issued a formal ruling this week that property owners will not be asked to count the subsidies they receive for replacing lead pipes as income when filing federal income taxes, or need to file amended tax returns if their lead service line was already replaced. Milwaukee Water Works has never notified customers that they may be expected to report their subsidy as income, but the absence of clarity on the issue at the federal level caused confusion for some property owners.
Milwaukee Water Works praised the ruling and the National League of Cities for their advocacy
“With this ruling from the IRS, homeowners can be confident that the benefits of any subsidized replacement of their lead service line will not incur any tax liabilities,” said Water Works Superintendent Patrick Pauly. “We’re pleased that the IRS has brought long-sought clarity to this issue and commend the National League of Cities for their advocacy on behalf of property owners.”
Milwaukee Water Works recently announced that the vast majority of lead service line replacements will be fully subsidized. Previously, the City of Milwaukee and Milwaukee Water Works paid about 80% of the cost for each replacement.
The additional taxes could have amounted to $1,000 per household, according to the National League of Cities. With municipalities prioritizing replacements among low-income and other disadvantaged groups, many of the property owners who will receive or have received financial assistance to replace lead service lines are not in a position to pay additional taxes.
On Tuesday, Michael Gleeson and Carolyn Berndt of the National League of Cities federal advocacy team met with the IRS Chief Counsel’s Office to argue that lead service line replacement should be excluded from income.
In Announcement 2024-10, issued Tuesday, the IRS agreed, stating in part, “The replacement of lead service lines…does not result in income to the residential property owners under § 61 of the Internal Revenue Code.”
NOTE: This press release was submitted to Urban Milwaukee and was not written by an Urban Milwaukee writer. While it is believed to be reliable, Urban Milwaukee does not guarantee its accuracy or completeness.
More about the Lead Crisis
- MTEA Statement on Lead Exposure in MPS Buildings - Milwaukee Teachers’ Education Association - Apr 30th, 2025
- Statement from Supervisor Juan Miguel Martinez on Lead Hazards in MPS Buildings - Sup. Juan Miguel Martinez - Apr 29th, 2025
- MPS Closing Two More Schools For Lead Hazards - Jeramey Jannene - Apr 28th, 2025
- Milwaukee Public Schools Enters New Phase of Lead Cleanup - Milwaukee Public Schools - Apr 28th, 2025
- What To Know and How To Keep Kids Safe From Lead Poisoning - Evan Casey - Apr 25th, 2025
- Congresswoman Gwen Moore and Senator Tammy Baldwin Urge HHS Secretary Robert F. Kennedy, Jr. to Reinstate Childhood Lead Poisoning Experts at CDC, Push for Approval of Milwaukee’s Request for Federal Assistance - U.S. Rep. Gwen Moore - Apr 23rd, 2025
- MPS’s Fernwood School to Reopen Following Lead Remediation Work - Milwaukee Public Schools - Apr 22nd, 2025
- Milwaukee School Board May Sue Paint Companies Over Lead Crisis - Evan Casey - Apr 19th, 2025
- Trump Administration Axed Federal Employees Needed for MPS Lead Crisis - Jeramey Jannene - Apr 14th, 2025
- New MPS Superintendent Dumps Beleaguered Facilities Director - Jeramey Jannene - Apr 3rd, 2025
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