The Disabled Access Credit is a US federal tax credit that takes half of what an eligible small business spends removing barriers for people with disabilities off its tax bill. It covers 50% of eligible spending above $250 and up to $10,250 in a year, so the largest credit anybody can claim is $5,000. It is nonrefundable and it runs through the general business credit rules, which means it reduces tax you owe rather than arriving as a cheque. You are eligible if, for the previous tax year, your gross receipts were $1,000,000 or less, or you had 30 or fewer full-time employees. Either test on its own is enough and both bounds are inclusive, so exactly 30 employees still qualifies. You claim it on IRS Form 8826, and it resets every tax year. Whether website accessibility work counts as eligible spending is an open question, so treat accessibility audit costs as costs that may qualify. Ask your accountant.
In practice
A credit is not a deduction, and the difference is the whole reason to know about this one. A deduction comes off the income you are taxed on. A credit comes off the tax itself, dollar for dollar, so it is worth considerably more than a deduction of the same size. How much more depends on your marginal rate, and at ordinary business rates it is a large multiple rather than a small one.
Whether website accessibility work qualifies is an open question, and we are not going to pretend otherwise on a page somebody is reading before they spend money. The statute ties eligible spending to complying with the ADA as that law stood on November 5, 1990, and it names four categories, none of which mentions anything digital. Removing barriers is broad language and consulting fees do appear on the government's own list of covered costs, so the argument is a reasonable one. It is an argument rather than a citation. The same statute also says eligible expenditures have to meet standards issued by Treasury with the Access Board, and we have found no such standard written for the web. Ask your accountant before you count on any of it.
Two conditions catch people out. Claim the credit against an expense and you cannot also deduct that same money, so the saving is the credit rather than the credit plus the deduction. And every entity in a controlled group or under common control counts as a single taxpayer for the size tests. That is how a business split across three companies finds out it does not qualify after all.
Why it matters
For a small business this changes what an audit actually costs. Half of the spend above the $250 floor comes off the tax bill, so a $499 audit is $374.50 after the credit, if you are eligible, if the spend counts and if you owe enough tax to use the credit. The final after-tax figure can land lower still, because the $374.50 the credit did not cover may itself be deductible. What you cannot do is claim both on the same dollar. There is a second incentive most people never hear about. A separate section of the code allows a deduction of up to $15,000 a year for barrier removal, and it is open to a business of any size. Its written scope is architectural and transportation barriers rather than anything digital, which is the first question to put to your accountant rather than a reason to stop asking. None of this is tax advice, and the person who signs your return is the person to ask.
The size test, read exactly
Both bounds are inclusive and either test on its own is enough. Gross receipts of exactly $1,000,000 in the previous year qualifies. So does exactly 30 full-time employees, whatever the revenue was. Full-time here means at least 30 hours a week for 20 or more weeks in the year, and gross receipts means before costs and after returns and allowances.
Where this shows up on the site
Related terms
- ADAThe ADA is the main US disability rights law, signed in 1990 and broadened by amendments in 2008.
- Accessibility auditAn accessibility audit is a structured evaluation of a website against WCAG, ending in a documented pass or fail for every applicable rule with the evidence attached.
- RemediationRemediation is the work of fixing the accessibility problems an audit found, in the code, the content and the design, until the failures are gone.
Knowing the word is the easy part.
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