ADA Tax Credit for Small Businesses: Claim Up to $5,000

What Is the Disabled Access Credit?

The Disabled Access Credit (IRS Section 44, filed on Form 8826) is a non-refundable tax credit designed to help small businesses cover the cost of ADA compliance. It applies to expenditures made to comply with the Americans with Disabilities Act, including both physical and digital accessibility improvements.

The credit covers 50% of eligible expenditures between $250 and $10,250, resulting in a maximum credit of $5,000 per year. The first $250 in expenses is not covered (your threshold), and expenses above $10,250 exceed the credit cap.

Eligibility Requirements

To qualify for the Disabled Access Credit, your business must meet both of these criteria:

• Total revenue: $1,000,000 or less in the prior tax year.
• Number of employees: 30 or fewer full-time employees.

The business must be a for-profit entity. Non-profits and government entities do not qualify for this credit (though they may have other funding mechanisms).

What Website Accessibility Expenses Qualify

The IRS defines eligible expenses broadly as amounts paid or incurred to comply with the ADA. For website accessibility, qualifying expenses typically include:

• Professional accessibility audits and assessments
• Website remediation and development work to fix WCAG violations
• Accessibility scanning and monitoring tools (like ADA Scanner plans)
• Consulting services for accessibility compliance planning
• Training for staff on accessible content creation
• Accessible document remediation (PDFs, forms, etc.)
• Captioning and transcription services for video content

How to Calculate the Credit

The calculation is straightforward:

1. Add up all eligible ADA compliance expenses for the tax year.
2. Subtract the $250 threshold from the total.
3. Take 50% of the remaining amount, up to a maximum of $5,000.

Example: Your business spends $6,000 on website accessibility remediation and monitoring. Subtract the $250 threshold = $5,750. Take 50% = $2,875 tax credit. You spent $6,000 but effectively reduced that cost by $2,875 through the credit.

Example at maximum: Your business spends $10,250 or more. $10,250 - $250 = $10,000. 50% = $5,000 maximum credit.

The Architectural Barrier Removal Deduction (Section 190)

In addition to the Section 44 credit, businesses of any size can deduct up to $15,000 per year in expenses for removing architectural and transportation barriers under Section 190. While this deduction was traditionally used for physical accessibility improvements (ramps, accessible restrooms), some tax professionals argue that digital accessibility expenditures may qualify as well.

Small businesses that qualify for both can use the Section 44 credit on the first $10,250 in expenses and the Section 190 deduction on additional amounts, maximizing tax benefits. Consult your tax advisor for guidance specific to your situation.

How to Claim the Credit

1. Track your expenses. Keep detailed records of all accessibility-related expenditures, including invoices, contracts, and receipts.
2. Document the ADA connection. Retain documentation showing that expenses were incurred for ADA compliance: scan reports, remediation plans, and WCAG audit results.
3. File IRS Form 8826. Complete the Disabled Access Credit form and attach it to your business tax return.
4. Consult a tax professional. A CPA or tax advisor familiar with ADA credits can ensure you maximize the benefit and document it properly.

The Credit Can Be Claimed Every Year

The Disabled Access Credit is not a one-time benefit. You can claim it every tax year for new qualifying expenses. This makes it ideal for businesses that approach accessibility as an ongoing investment rather than a one-time project. Annual expenses for accessibility monitoring, content remediation, and staff training can all qualify.

Getting Started with Compliance

The first step is understanding where your website stands. Run a free accessibility scan to identify your current WCAG 2.1 AA violations. The scan report can serve as documentation of the accessibility issues that your expenditures address, supporting your tax credit claim.