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Tax Credits for Deaf and Hard of Hearing Access

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Updated April 17, 2010

Small businesses can make themselves accessible to deaf and hard of hearing people, and Federal and state tax credits can help.

Federal Tax Credit

The Internal Revenue Service (IRS) has a special section of the Internal Revenue Code -- section 44 -- which provides a tax credit that enables small businesses to cover accessibility expenses. According to the tax code, businesses with previous tax year revenue of $1,000,000 or less (or 30 or fewer full-time workers) can use this credit to recoup costs associated with making their business accessible to deaf and hard of hearing people under the Americans with Disabilities Act (ADA).

The federal tax credit can be used to cover expenses related to making 'aurally delivered' materials accessible, such as the provision of sign language interpreters, or captioning. A small business can take a tax credit for 50% of their costs beyond the first $250 of expenses, up to a maximum expenditure (currently $10,250; the first $250 does not count). The most a small business can get credit for is currently $5,000 worth of costs. Businesses use Form 8826 [PDF] to get the credit when filing their taxes.

State Tax Credits

Some states have tax credits that mirror the federal tax credit, or help cover additional costs not covered by the federal tax credit. The amount of the credit is set by each state, and some are more generous than others. Some examples:

California

California has a disabled access credit, administered by the California Franchise Tax Board. Small businesses in California can claim half of their expenses, up to a maximum of $125. The claim can be made by filing the California tax form Disabled Access Credit for Eligible Small Businesses - 3548, downloadable from the California Franchise Tax Board website.

Kansas

Kansas has a credit for half of the costs or $10,000, whichever is less. Kansas small businesses use Kansas form K-37, which can be downloaded at the Kansas Department of Revenue website, to claim the credit.

Missouri

Missouri's disabled access credit can be used by small businesses in Missouri whose accessibility costs exceed the $10,250 Federal credit limit. Missouri small businesses can claim up to half of their costs that go beyond the Federal credit limit, up to a maximum of $5,000. Missouri small businesses use form MO-8826, downloadable from the Missouri Department of Revenue website, to claim the credit.

Rhode Island

Rhode Island's credit allows a small business to claim 10% of the costs up to a maximum of $1,000, against either the Business Corporation Tax or the Public Service Corporation Tax.

Does Your State Have a Small Business Disabled Tax Credit?

There may be additional states with disabled tax credits for small businesses. Some of the aforementioned tax credits were found by exploring the state tax agency websites, via the State Tax Central website.

Sources:

Tax Incentives for Businesses
Section 44 of Internal Revenue Code
Rhode Island Division of Taxation

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