ADA InfoBrief

IRS Code Section 190, Barrier Removal

What is it? Business may take an annual deduction for Expenses incurred to remove physical, structural and transportation barriers for people with disabilities.

Who is eligible? All businesses are eligible.

What expenses are covered? The architectural/transportation deduction is available each year to businesses with qualifying expenses. It can be used for a variety of costs to make a building or vehicle used to transport an employee or the public which is owned or leased for use by the business more accessible to or useable by people with disabilities. Examples of deductions include:

• Providing accessible parking spaces, ramps and curb cuts;
• Providing telephones, water fountains and restrooms that are accessible for individuals using wheelchairs;
• Making walkways at least 48" wide, and/or providing accessible entrances to buildings including accessible hardware and electric doors;
• Installing a lift in a company shuttle bus/vehicle

What expenses are not covered? The deduction may not be used for expenses incurred for new construction, completion of renovation being done to a facility and/or public transportation vehicle or for normal replacement of a depreciable property.

What is the amount of the deduction? The Internal Revenue Service (IRS) allows a deduction of up to $15,000 per year for qualified expenses.

How can this expenditure be deducted? Business should follow the instructions found in IRS Publication 907 and in IRS Publication 535, entitled: Business Expenses.

IRS Code Section 44, Disabled Access Credit

What is it? Small businesses may take an annual tax credit for making their businesses accessible to people with disabilities.

Who is eligible: Small businesses who in the previous year earned $1 million or less in gross receipts or had 30 or fewer full-time employees are eligible for the Small Business Tax Credit.

What expenses are covered? The tax credit is available every year and can be used for a variety of costs such as:

• Sign language Interpreters for employees/customers who are deaf or hard of hearing ;
• Readers for employees/customers who are blind or visually impaired;
• The purchase of adaptive equipment or the modification of existing equipment;
• Services of a consultant necessary to evaluate the workplace and/or job task for recommendations;
• Production of printed materials in alternative formats (e.g. Braille, Large Print, audio tape, electronic, inc.)
• The removal of architectural barriers in buildings or installation of a lift in a vehicle; and
• Other similar services (i.e. use of a job coach or a co-worker to provide support to an employee with a disability).

What expenses are not covered? The tax credit does not apply to the costs of new construction or for accessibility features that are required as part of a planned renovation of a building or facility.

What is the amount of the deduction? The tax credit is 50% of expenditures over $250, but not to exceed $10,250 for a maximum benefit of $5000 per tax year.