Tax Incentives for Employers
Private-sector businesses that make structural adaptations or other accommodations for employees or customers with disabilities may be eligible for tax incentives.
- Work Opportunity Tax Credit (WOTC) This credit is available to employers for hiring individuals from certain target groups who have consistently faced significant barriers to employment. On December 18, 2015, President Obama signed the Protecting Americans from Tax Hikes Act of 2015 (PATH Act) that extends and modifies the WOTC Program and the Empowerment Zones for a five-year period from December 31, 2014 to December 31, 2019. Employers use Form 8850 to pre-screen and to make a written request to the state workforce agency (SWA) of the state in which their business is located (where the employee works) to certify an individual as a member of a targeted group for purposes of qualifying for the work opportunity credit.
- Disabled Access Credit The Disabled Access Credit provides a non-refundable credit of up to $5,000 for small businesses that incur expenditures for the purpose of providing access to persons with disabilities. An eligible small business is one that earned $1 million or less or had no more than 30 full time employees in the previous year; they may take the credit each and every year they incur access expenditures. Refer to Form 8826, Disabled Access Credit (PDF), for information about eligible expenditures.
- Architectural/Transportation Tax Deduction This deduction (IRS Code Section 190, Barrier Removal) allows business of all sizes to take an annual deduction of up to $15,000 for expenses such as creating accessible parking; installing ramps and curb cuts; making telephones, water fountains and restrooms accessible; and widening walkways. It may also be used for vehicle adaptation. Learn more on the IRS website.
Small businesses that meet the criteria for the Disabled Access Credit may use it and the Architectural/Transportation Tax Deduction together if the expenses incurred qualify.
For more information about these tax incentives and their requisite forms, please see the Internal Revenue Service (IRS) website.
For more information about structural accessibility and job accommodations for people with disabilities, contact the Job Accommodation Network (JAN), a free service of ODEP. JAN also offers a fact sheet on tax incentives.
The Employer Assistance and Resource Network on Disability Inclusion (EARN) also provides information about employer financial incentives, including tax incentives: