Disability Focus Tax Incentives - Employers and Individuals with Disabilities
It’s tax season! Businesses accommodating or hiring employees with disabilities may qualify for tax credits and deductions. Key examples include the Work Opportunity Tax Credit (WOTC), Architectural Barrier Removal Tax Deduction, and state employer tax incentives. For individuals with disabilities, they may qualify to contribute to a tax-advantaged savings account to fund disability expenses. This resource page includes more information about different financial incentives available.
Tax Incentives for Businesses
Work Opportunity Tax Credit (WOTC) - This tax credit provides employers incentives to hire qualified individuals from different target groups that are inclusive of people with disabilities. The maximum tax credit could reach as high as $9,600, depending on the employee hired and the length of employment. This link connects you with the latest resources from DOL ETA resource website.
Architectural and Transportation Barrier Removal Deduction - This tax deduction encourages businesses of any size to remove architectural and transportation barriers to the mobility of persons with disabilities. Businesses may claim a deduction of up to $15,000 a year for qualified expenses for items that normally must be capitalized. This link connects you with the mid-Atlantic ADA Center outlining facts about this tax deduction and other tax incentives.
State Employer Tax Incentives - Some state-specific tax credit programs for hiring people with disabilities are based on the Federal Government’s Work Opportunity Tax Credit (WOTC) and others are related to accessibility improvements and employment supports. This link from EARN provides an overview of how different states apply its state employer tax incentives.
Tax-Advantage Savings for Individuals with Disabilities
ABLE Accounts – Individuals with disabilities may be eligible for ABLE Accounts (Achieving a Better Life Experience Act), which are tax-advantaged savings accounts for individuals with disabilities and their families. The funds in an ABLE account can pay for “qualified disability expenses” to help improve one’s health, independence and quality of life. This link routes you to the ABLE National Resource Center to learn more.
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