In some cases, your business is legally obligated to make the premises accessible to disabled individuals.
Strategy: Build the "disabled access credit” into your plans. If you qualify, you can write off half the cost. What’s more, the disabled access credit covers more than you might think. It’s not just limited to installing ramps and guardrails.
Here’s the whole story: A small business is eligible to claim the disabled access credit for making business premises more accessible to disabled individuals. For this purpose, a “qualified small business” is one with gross receipts of $1 million or less or one that didn’t employ more than 30 full-time employees in the preceding tax year. The credit can be carried back for one year and forward for up to 20 years.
The disabled access credit is equal to 50% of the first $10,000 of qualified expenses. (Technically, the first $250 of expenses is excluded, but the credit applies to the first $10,250 of expenses.) Thus, the maximum credit is $5,000.
The expenses must be incurred to meet requirements established by the Americans with Disabilities Act (ADA). For instance, a small business can claim the credit for the following costs:
- Removal of architectural, communication, physical, or transportation barriers that prevent a business from being accessible to, or usable by, disabled individuals.
- Providing qualified interpreters or other effective methods of making orally delivered materials available to hearing-impaired individuals.
- Providing qualified readers, taped texts and other effective methods of making visually delivered materials available to visually impaired individuals.
- Acquiring or modifying equipment or devices for disabled individuals.
- Providing other similar services, modifications, materials, or equipment. (IRC Sec. 44(c))
The modification does not have to exclusively benefit disabled individuals.
Tip: The disabled access credit is claimed as part of the general business credit. Use Form 8826, Disabled Access Credit.