This article will discuss the following:
- Additional taxable substances added via Notice 2025-41
- Additional taxable substances added via Notice 2025-51
- Additional taxable substances added via Notice 2026-43
Background
As part of the Infrastructure Investment Jobs Act, effective July 1, 2022, excise taxes were reinstated on certain chemical and imported chemical substances. The application of rates and related provisions were also modified since these taxes expired in 1995. Section 4671(a) of the Internal Revenue Code of 1986, as amended (the “Code”) established an excise tax on the sale or use of a taxable substance. Section 4672(a)(1) of the Code defines “taxable substance” as any substance listed as a taxable substance by the Secretary of the Treasury or included on the list of taxable substances in Section 4672(a)(3). The IRS originally issued the list of taxable substances via Notice 2021-66 and included applicable tax rates via Form 6627 instructions. Procedures to request an IRS determination to add or remove a substance from the list of taxable substances under Section 4672(a) are in Revenue Procedure 2022-26.
Revenue Procedure 2023-20 modifies Revenue Procedure 2022-26 for the date on which a taxable substance is added to the list of taxable substances for purposes of refund claims under Section 4662(e).
The IRS issued Notice 2025-41, Notice 2025-51, and Notice 2026-43 which added additional taxable substances subject to the excise tax.
Forvis Mazars Insight: Adjustments to the taxable substance list found in Section 4672(a)(3) are made through Notices as highlighted below. Businesses that manufacture or import chemical substances should review the latest additions to the taxable substance list that took effect in the first quarter of 2026. These updates may create new excise tax filing obligations, especially for businesses that have not previously been required to file excise tax returns.
Additional Substances added via Notice 2025-41
| Taxable Substance | Rate/Ton($) | Taxable Substance | Rate/Ton($) |
|---|---|---|---|
| Polyphenylene sulfide | 14.5 | Propylene glycol methyl ether | 10.58 |
| Cellulose acetate (degree of substitution = 1.5–2.0) | 1.65 | Propylene glycol n-propyl ether | 10.43 |
| 4,4-isopropylidenediphenol-epichlorohydrin copolymer | 14.13 | Propylene glycol phenyl ether | 13.16 |
| Nylon 6 | 14.77 | Di-isobutyl carbinol | 8.57 |
| Caprolactam | 14.77 | Di-isobutyl ketone | 8.67 |
| Methyl ethyl ketoxime | 11.41 | Methyl isobutyl carbinol | 7.99 |
| Iso-butanol | 7.07 | Cyanuric acid | 2.11 |
| Diethylene glycol monomethyl ether | 5.47 | Potassium bicarbonate | 0.25 |
| Ethylene glycol phenyl ether | 10.42 | Potassium carbonate | 0.36 |
| Methoxytriglycol | 5.66 | Sodium chlorite | 2.35 |
| Propylene glycol methyl ether acetate | 8.85 |
Additional Substances added via Notice 2025-51
| Taxable Substance | Rate/Ton($) | Taxable Substance | Rate/Ton($) |
|---|---|---|---|
| Acrylonitrile-butadiene rubber | 9.58 | Di-tridecyl phthalate | 7.50 |
| Bromo-isobutene-isoprene rubber | 9.72 | Ethylene propylene diene (EPDM) rubber | 9.45 |
| Chloroprene rubber | 10.51 | Isodecyl alcohol | 7.01 |
| Ethylene-propylene-ethylidene norbornene rubber | 9.25 | Isodecyl benzoate | 7.60 |
| Ethylene vinyl acetate | 7.09 | Isooctyl alcohol | 6.62 |
| Ethylene vinyl acetate | 6.77 | Linear nonyl phthalate | 7.69 |
| Hydrogenated acrylonitrile-butadiene rubber | 9.54 | Linear nonyl undecyl phthalate | 7.89 |
Isobutene-isoprene rubber | 9.64 | Linear undecyl phthalate | 7.89 |
| Poly(ethylene-propylene) rubber | 9.74 | Linear nonyl tri-mellitate | 5.55 |
| Emulsion styrene-butadiene rubber | 9.74 | Neo decanoic acid | 6.43 |
| Solution styrene-butadiene rubber | 9.74 | Neo pentanoic acid | 5.36 |
| Emulsion styrene butadiene rubber | 9.74 | Nonene | 8.77 |
| Solution styrene-butadiene rubber | 9.74 | Regular butyl rubber | 9.64 |
| Hydrogenated acrylonitrile-butadiene rubber | 10.02 | Tridecyl alcohol | 7.40 |
| Bromobutyl isobutylene Isoprene Rubber | 9.63 | Tri-isononyl tri-mellitate | 5.06 |
| Chlorobutyl isobutylene isoprene rubber | 9.50 | Di-isobutylene | 9.74 |
| DIPE-diisopropyl ether | 7.99 | Polyisobutylene | 9.74 |
| Di-isodecyl phthalate | 7.31 | Styrene-acrylonitrile | 9.91 |
| Di-isononyl adipate | 7.07 | Acrylonitrile butadiene styrene | 9.90 |
| Di-isononyl phthalate | 7.11 |
Additional Substances added via Notice 2026-43
| Taxable Substance | Rate/Ton($) | Taxable Substance | Rate/Ton($) |
|---|---|---|---|
| Chloro-isobutene-isoprene rubber | 9.46 | Ethylene-propylene-dicyclopentadiene rubber | 9.64 |
Effective Date
The effective taxable date for all substances included in Notice 2025-41 and Notice 2025-51 was January 1, 2026. For the substances included in Notice 2026-43, the effective date is October 1, 2026.
Substance Modification in Notice 2025-41
In addition to the twenty-one substances added via Notice 2025-41, a typographical error in Notice 2021-66 was adjusted as well. The spelling of sodium nitrilotriacetate monohydrate was fixed from the misspelled “sodium nitriolotriacetate monohydrate” and a tax rate of $3.97 per ton was prescribed. This tax rate is effective as of July 21, 2022. Section 4 of Notice 2021-66 was retroactively adjusted to reflect the corrected spelling.
How Forvis Mazars Can Help
The introduction of additional taxable substances could impact importers and producers of such substances. Forvis Mazars can help businesses understand the requirements and comply with the filing of excise tax returns.