S.504 - High Rise Fire Sprinkler Incentive Act of 2025 (119th Congress)
Summary
The High Rise Fire Sprinkler Incentive Act of 2025 (S.504) aims to amend the Internal Revenue Code of 1986 by reclassifying certain automatic fire sprinkler system retrofits as 15-year property for depreciation purposes. This reclassification would apply to sprinkler systems meeting National Fire Protection Association 13 standards, installed in residential buildings with occupiable floors more than 75 feet above fire department vehicle access, and placed in service before the installation date.
The bill intends to incentivize the installation of fire sprinkler systems in older, high-rise residential buildings by providing a tax benefit to property owners.
The bill was introduced in the Senate on February 10, 2025, and referred to the Committee on Finance.
Expected Effects
If enacted, S.504 would likely lead to increased installation of automatic fire sprinkler systems in older, high-rise residential buildings due to the more favorable depreciation schedule. This could reduce the financial burden on property owners undertaking such retrofits.
This may also lead to increased demand for fire sprinkler system installation services and equipment.
Ultimately, this bill aims to improve fire safety in high-rise residential buildings.
Potential Benefits
- Increased Fire Safety: Encourages installation of fire sprinkler systems, reducing fire-related injuries and fatalities.
- Economic Incentive: Provides a tax benefit to property owners, making retrofits more affordable.
- Stimulates Construction: Creates demand for sprinkler system installation, benefiting construction and manufacturing industries.
- Property Value: Enhances the safety and potentially the value of older high-rise residential buildings.
- Modernization: Promotes the modernization of fire safety infrastructure in existing buildings.
Potential Disadvantages
- Revenue Loss: The reclassification of property for depreciation purposes could result in a decrease in federal tax revenue.
- Complexity: Introduces additional complexity to the tax code, potentially requiring clarification and guidance from the IRS.
- Potential for Abuse: Risk of misclassification or fraudulent claims related to sprinkler system retrofits.
- Limited Scope: The incentive is limited to specific types of residential buildings, excluding other structures that could benefit from sprinkler systems.
- Cost Shifting: The tax benefit effectively shifts some of the cost of fire safety improvements from property owners to taxpayers.
Most Disadvantaged Areas:
Constitutional Alignment
The bill appears to align with the general welfare clause of the Constitution (Preamble), as it aims to improve public safety by incentivizing fire sprinkler system installations. Congress has the power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States (Article I, Section 8, Clause 1). The bill uses the tax code to encourage specific behavior (fire safety improvements), which falls under Congress's enumerated powers.
There are no apparent conflicts with individual rights or limitations on government power as defined in the Bill of Rights.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).