Did you know that there are significant tax credits and deductions for improving accessibility? In fact, the IRS provides a federal tax credit to cover up to 50% of the cost of accessibility improvements. If you are planning to make improvements the disability access in the built environment, you may want to consult with your tax professional to take advantage of any incentive that may be available.

Federal Tax Credit - The IRS provides a federal tax credit for small businesses that incur expenditures for the purpose of providing access to persons with disabilities. The tax credit will cover 50% of the cost of accessibility improvements up to $10,250. The maximum per year credit is $5,000 and is available to businesses with 30 or fewer employee or total revenues of $1 million or less. Eligible expenses include physical barrier removal such as: constructing ramps, re-striping accessible parkings, installing grab bars, etc.

California Tax Credit - The California Disabled Access Credit for Eligible Small Businesses is similar to the federal Disabled Access Credit, with exceptions. The maximum per year credit is $125 and is available to businesses with 30 or fewer employee or total revenues of $1 million or less.

Federal Tax Deduction - In addition to the tax credits above, the IRS will allow a deduction of up to $15,000 for eligible expenses in the year that the work was performed. These expenses apply only to barrier removal and not new construction. However, the deduction is available to businesses of all sizes and can be used every year that eligible expenses are incurred.

If you made accessibility improvements or if you are planning ADA improvements we advise that you consult with your tax professional. A CPA can help you understand what expenses are eligible for the ADA compliance tax credits and deductions. Since Proactive Access LLC provides accessibility consulting, be sure to ask your CPA what portion, if any, of our CASp Inspection fees can be offset by these tax credits & deductions.

Disclaimer: The information contained within this article is not intended to be legal advise or tax advise. If you have tax accounting questions, you should seek the advice of a Certified Public Accountant.