If you operate a business that's open to the public, you're legally required to make the premises accessible to disabled customers. That may include creating wheelchair ramps, wider aisles or reconfiguring your restrooms.
Strategy: Offset those costs by making sure they qualify for the "disabled access tax credit." If you qualify, you can literally gain a 50 percent tax discount.
Even better, if you did the accommodations work in 2004, you can amend your 2004 tax return to grab the disabled access credit.
Disabled access credit. Small businesses can claim the disabled access credit for costs associated with making the premises more accessible to disabled people. In this case, a qualified "small business" is an operation with gross receipts of $1 million or less or fewer than 30 full-time employees in the preceding tax year. You can carry the credit back for one year and forward up to 20 years.
The credit is equal to 50 percent of up to $10,000 of qualified expenses, meaning the maximum credit is $5,000. Use IRS Form 8826, Disability Access Credit.
What expenses qualify? Expenses must be incurred to meet Americans with Disabilities Act (ADA) requirements. Examples: removing walls, curbs and other barriers to physical access or altering communication equipment, such as providing equipment for individuals with hearing impairments.
Bottom line: If you want to secure a disabled access credit for 2005, review your potential projects now, and choose the ones that would qualify for the credit (see box at right). Also, review your projects from 2004 to see if any of them helped provide access to disabled people and, therefore, make you eligible for the credit.