TAX INCENTIVES
Businesses that improve accessibility may be eligible for federal tax benefits that help offset certain qualifying costs. Eligibility depends on the business, the property, the type of improvement, and current tax requirements, so owners should consult a qualified tax professional before claiming any credit or deduction.
DISABLED ACCESS CREDIT
Eligible small businesses may claim a nonrefundable federal tax credit for certain expenses incurred to improve access for people with disabilities.
A business may qualify if it had gross receipts of $1 million or less or no more than 30 full-time employees during the previous tax year. The credit is generally equal to 50% of eligible expenses over $250, up to a maximum credit of $5,000, and is claimed using IRS Form 8826.
BARRIER REMOVAL TAX DEDUCTION
Businesses of any size may be able to deduct up to $15,000 per year for qualified expenses related to removing architectural or transportation barriers.
Qualifying work may include improvements that make entrances, routes, restrooms, parking areas, and other features more accessible to people with disabilities or older adults.
USING BOTH INCENTIVES
A business may be able to use the Disabled Access Credit and the Barrier Removal Tax Deduction in the same tax year when the expenses meet the requirements of both programs.
The same expense cannot receive a double benefit. The deduction is generally reduced by the amount of the credit claimed.
DOCUMENTATION MATTERS
Accurate records can help support a tax professional’s evaluation of eligible expenses.
Inspection reports, photographs, measurements, invoices, project descriptions, and documentation of completed accessibility improvements may help establish what work was performed and why it was necessary.
PLANNING ACCESSIBILITY IMPROVEMENTS?
We can help identify barriers, document existing conditions, and provide practical recommendations before work begins.