ADA Section 44 and Section 179 Tax-Credit Calculator | MTI

Specialized Equipment for Specialty Healthcare

ADA Section 44 and Section 179 Tax-Credit Calculator

Your practice could save thousands of dollars1 when you purchase ADA-compliant equipment.

An eligible practice may elect to apply a credit against income tax. The credit is equal to 50% of the chair(s)’ purchase price that is over $250 and not more than $10,250. Thus, the maximum one-time ADA tax credit available per year is $5000. In addition, the practice may deduct an accelerated depreciation from Section 179. Input your chair cost and tax bracket below to estimate your final chair cost.

Do you qualify?

To qualify for the ADA Tax, the practice must meet at least one of the following qualifications:

  1. 1 Annual gross reciepts of the practice are less than $1,000,000.
  2. 2 The practice employes less than 30 full-time employees the year before the taxable year in which the credit is elected.

 

HHS and DOJ have adopted ADA-standards for Exam Chairs

The U.S. Department of Health and Human Services (“HHS”) and the U.S. Department of Justice (“DOJ”) issued final rulings requiring medical and dental offices, clinics, emergency rooms, hospitals, and other healthcare settings, to comply with the 2017 U.S. Access Board’s Standards for Accessible Medical Diagnostic Equipment (the “Standards”), such as your examination chairs.2 You can learn more about what this means and how you can stay compliant here.

1 “thousands of dollars” assumes the average purchase price of an MTI exam and procedure chair assuming a tax bracket of 32%.
2 45 CFR 84, 89 FR 40066 and 28 CFR Part 35, 89 FR 65180.

Please consult your tax advisor for professional advice regarding the ADA Section 44 Tax Credit since, currently, there is an unresolved difference of opinion regarding the availability of the ADA Section 44 Tax Credit for purchases of medical equipment. MTI believes that a disabled access credit may be available to medical practices that have purchased MTI power tables(s)/chair(s) because they enable such practices to facilitate access for disabled individuals. However, the Internal Revenue Service issued a Technical Advice Memorandum (TAM200031001) to an optometrist denying the ADA Section 44 Tax Credit for a variable height visual field analyzer. This TAM states explicitly that “it may not be used or cited as precedent,” but it does reflect a strict interpretation of ADA Section 44 Tax Credit by the IRS. Accordingly, the material presented in this handout regarding the ADA Section 44 Tax Credit should be reviewed by your tax advisor.