Tax Incentives
Tax Incentives are available to encourage compliance with the Americans with Disabilities Act (ADA). This chart includes the Federal tax incentives and encourages you to inquire whether your state offers similar incentives. Unfortunately, many business owners and employers are unaware that these incentives exist. Make sure your business takes advantage of these valuable incentives!
Tax Comparison Chart
Small Business Tax Credit
Code:Section 44,Disabled Access Credit Form: 8826
Eligible:Small Business
Purpose:Most expenses to comply with the ADA, including barrier removal providing auxiliary aids and services, and accommodating employees. Ex: Providing sign language interpreters, creating Braille documents, building ramps.
Amount:50% between $250 & $10,250 Max=$5,000
Work Opportunity Tax Credit
Code:Form: 5884
Eligible:Small Business.
Purpose: This credit encourages employment of certain targeted groups, including SSI recipients and vocational rehabilitation referrals.
Amount:Max=$2,400
Did You Know?
-A small business is one that has 30 or fewer employees OR $1,000,000 or less in gross receipts from the previous year.
-If a credit exceeds the amount of taxes owed, businesses may carry forward the unused portion of the credit to the next year.
-Small businesses cannot claim a tax credit and deduction for the same dollar spent; however, they can use the incentives in combination provided that the expenditures incurred qualify under both. See Example C
-Physical modifications must comply with the applicable accessibility standards (ADA Accessibility Guidelines).
For More Information
National Network of ADA Centers:
Free technical assistance: (800) 949-4232 V/TTY. www.adata.org
Internal Revenue Service
(IRS) Questions: (800) 829-4059 TTY. Legal Questions: (202) 622-3110 V. Publications and forms: (800) 829-3676 V (800) 829-4059 TTY http://www.irs.gov/formspubs/index.html
U.S. Department of Justice (DOJ) Disability Rights Section: Questions: (800) 514-0301 V; (800) 514-0383 TTY
This fact sheet is not intended to provide legal tax advice. Please consult the IRS or your tax advisor for legal tax advice.
Content Developed by the Mid-Atlantic ADA Center