Tax Incentives Encourage Employment of People with Disabilities & Promote Accessibility
The Internal Revenue Code includes several provisions aimed at making businesses more accessible to people with disabilities. The following provides general – non-legal – information about three of the most significant tax incentives.
- Small Business Tax Credit (Internal Revenue Code Section 44: Disabled Access Credit): Small businesses with either $1,000,000 or less in revenue or 30 or fewer full-time employees may take a tax credit of up to $5,000 annually for the cost of providing reasonable accommodations such as sign language interpreters, readers, materials in alternative format (such as Braille or large print), the purchase of adaptive equipment, the modification of existing equipment, or the removal of architectural barriers.
- Work Opportunity Tax Credit (Internal Revenue Code Section 51): Employers who hire certain targeted low-income groups, including individuals referred from vocational rehabilitation agencies and individuals receiving Supplemental Security Income (SSI) may be eligible for an annual tax credit of up to $2,400 for each qualifying employee who works at least 400 hours during the tax year. Additionally, a maximum credit of $1,200 may be available for each qualifying summer youth employee.
- Architectural/Transportation Tax Deduction (Internal Revenue Code Section 190 Barrier Removal): This annual deduction of up to $15,000 is available to businesses of any size for the costs of removing barriers for people with disabilities, including the following: providing accessible parking spaces, ramps, and curb cuts; providing wheelchair-accessible telephones, water fountains, and restrooms; making walkways at least 48 inches wide; and making entrances accessible.
Employers should check with their accountants or tax advisors to determine eligibility for these incentives, or visit the Internal Revenue Service’s website, for more information. Similar state and local tax incentives may be available.