Many businesses have made the unhappy discovery that their business is not ADA compliant, usually though an unexpected ADA lawsuit. The cost of bringing the facilities in to ADA compliance can be a burden. Take heart. In the event you have been required to incur expenses to bring your buildings and facilities in to ADA compliance, your business may qualify for valuable federal tax incentives. Two tax incentives are available to businesses to help cover the cost of improving access for the disabled.
The Disabled Access Credit established under Internal Revenue Code Section 44 is a tax credit available to help small businesses cover ADA-related access expenditures. A small business is one that had either revenues of $1,000,000 or less or 30 or fewer full-time workers in the previous tax year. The credit can be taken for a number of purposes including to remove barriers that prevent a business from being accessible to or usable by individuals with disabilities. The credit cannot be taken for the costs of new construction. The amount of the tax credit is equal to 50% of the eligible access expenditures in a year, up to a maximum expenditure of $10,250. There is no credit for the first $250 of expenditures. So, the maximum tax credit is $5,000.
A business of any size can take a tax deduction under Internal Revenue Code Section 190 for the costs of removing architectural or transportation barriers. The deduction is now a maximum of $15,000 per year.
Best of all, these two incentives can be used together by eligible businesses if the expenditures qualify. For more information consult http://www.ada.gov/archive/taxpack.htm or IRS Form 8826. If you believe that your business may qualify for these tax incentives you should discuss them with your business attorney or tax advisor.