Form 7220, Prevailing Wage and Apprenticeship Verification and Corrections

The IRS recently issued Form 7220, Prevailing Wage and Apprenticeship (PWA) Verification and Corrections for energy credits claimed in 2025. Taxpayers must use Form 7220 to report information for each facility or property where an increased credit or deduction is claimed for meeting Prevailing Wage and Apprenticeship (PWA) requirements.

What Has Changed with Form 7220

Previously, taxpayers subject to the PWA requirements attached a detailed statement for each facility or property at the time of filing the return. The statement included:

• The taxpayer’s name and identification number.
• A description of the facility or property (including owner information, if different from the filer) and, if applicable, the IRS-issued registration number.
• For facilities or properties that began construction before January 29, 2023, a statement indicating that the continuity requirement under the physical work test or the five percent safe harbor was met.
• For facilities or properties that began construction on or after January 29, 2023:
  • The applicable wage determinations by the Secretary of Labor.
  • The wages paid, including any correction payments, and hours worked for each laborer or mechanic classification engaged in the construction of the facility or property.
  • The number of workers who received correction payments.
  • The wages paid and hours worked by qualified apprentices for each laborer or mechanic classification.
  • The total labor hours for the construction of the facility or property by any laborer or mechanic employed by the taxpayer or any contractor or subcontractor.
  • A declaration, signed under penalties of perjury, that the statement and any accompanying documents were true, correct, and complete.

The Impact of the New Form 7220

By introducing a dedicated form for PWA verification, the IRS is standardizing, improving administrative efficiency, enhancing enforcement, and providing clearer guidance to taxpayers.

The Form 7220 is required to be attached to the following returns:

• Form 3468, Investment Credit, Part III, V, or VI.
• Form 7205, Energy Efficient Commercial Buildings Deduction.
• Form 7210, Clean Hydrogen Production Credit.
• Form 7211, Clean Electricity Production Credit.
• Form 7213, Nuclear Power Production Credit, Part II.
• Form 7218, Clean Fuel Production Credit.
• Form 8835, Renewable Electricity Production Credit.
• Form 8908, Energy Efficient Home Credit.
• Schedule A (Form 8911), Alternative Fuel Vehicle Refueling Property, Part II.
• Form 8933, Carbon Oxide Sequestration Credit.

A separate Form 7220 is required for each facility claiming an increased credit or deduction. Additionally, separate forms are needed to report ongoing compliance for alterations or repairs to facilities placed in service in a prior year for which an increased credit or deduction was claimed.

Form 7220 is also used to calculate penalties for failing to meet certain PWA requirements when increased credit or deduction amounts were claimed.

Form 7220 is not required for increased credit or deduction amounts that satisfy the beginning of construction or the one megawatt exceptions.

Next Steps for Form 7220

Navigating the PWA requirements is complex, and Form 7220 introduces an additional step in qualifying for tax credits and deductions.

Our business credits and incentives team can help you evaluate eligibility, estimate the potential value, and claim available credits.