Welcome to The application the federal tax incentives supporting the Americans with Disability Conference. At this time all participants are in a listen-only mode. Later we will connect question and answer session and instructions will be given at that time. Also, as a reminder, this conference is being recorded. I would now like to turn the conference over to Peter Burke. Sir, you may begin your call.
Thank you very much, Tammy. I just wanted to give a brief orientation and instructions for the participants that are joining us in the webinar platform before turning it over to our moderator for the day, Marisa Demaya. For those of you in the webinar room if you''ve joined us in the past, you will notice that the webinar room looks a little bit different this time around. This is the first time that we are using Blackboard Collaborate 12, which definitely has a new look to it. Some of the features and the keyboard shortcuts are the same. For those wanting to access the captioning, you can click on the CC icon or you can use the keystroke function control F8 to open up and modify the captioning window. To submit questions in the chat area, if you have questions as the session goes along, you can click on the chat entry area or Control M will place you into the area to enter a chat message. We still ask that participants refrain from using the emotion icons unless directed to do so by today''s speakers, otherwise that can cause some confusion for the speakers as well as individuals that are using assistive technology. And finally, you''ll notice that a little different in the look of the webinar room in that the captioning area, the chat area and the participant list are all on top of each other. Those can be unlinked and you can move it from one side of the window to the other side. Alright, with that, I will turn it over to Marisa Demaya with the Americans with Disabilities Act (ADA) -- with the Southwest ADA Center. Marisa?
Thanks, Peter. Hi, my name is Marisa Demaya. And I''m with the Southwest ADA Center. I''ll be serving as moderator for today''s session. Today''s program is brought to you as a collaborative effort between the Great Lakes and Southwest ADA Centers as part of the ongoing programs offered by the ADA National Network. Individuals joining us today are joining us using a variety of mediums, including the webinar platform; listening via the telephone; and of course, using real-time captioning. Today''s session will include a PowerPoint presentation. And there are a few materials that you can download for this session. If you are not able to download them ahead of time, you will be able to access those materials in the archive section of the website at www.adaconferences.org at the conclusion of today''s program. This session is being recorded and a recording will be available for review within the next 24 hours of the conclusion of this session. Our presenter today will provide us with some valuable information. And at the conclusion of his presentation there will be an opportunity for everyone to ask questions. As Peter mentioned earlier, you may submit your questions using the chat area within the webinar platform or by following the instructions provided by the telephone operator for those of you listening in on the phone. For those viewing the webinar platform, you will not be able to view your questions as they are submitted, but they will be viewable to me as your moderator and the presenters. They will address them at the end of the session, so feel free to submit them throughout the presentation as they come to your mind. Now I''ll begin today''s session by turning it over to Dr. Craig White. As you may know, Dr. White is the Moss Adams Professor of Accounting and Chair of the Accounting Department at the University of New Mexico''s Anderson School of Management, specializing in the area of federal income taxation. You can read a bit more about Craig by accessing his posted bio on the website, again, at www.adaconferences.org. And with that, I''m going to turn it over to you, Craig. Craig White: Alright. Well, thank you Marisa. I appreciate it. And thank you very much to the Southwest ADA Center and also to the Great Lakes ADA Center for hosting me today on this presentation. Thank you also to the participants. I appreciate your time today in getting together with us to talk about tax incentives and the ADA. If I could please just a little bit before I get into the meat of the information, I''d like to give you a little bit of context about where this is coming from. So as Marisa mentioned, I''m the Chair of the Accounting Department here at the University New Mexico at the Business School. You''ll notice on the PowerPoint slides I''ve also referenced Julie Ballinger with StarReach Enterprises with the Southwest ADA Center, and Tessah Latson Garcia with the New Mexico Business Leadership Network. Well, this work I''m going to go through today is really the outgrowth of a collaboration from around a year and a half ago where we got together and we were talking about the business aspects of disability, about how it''s a natural fit for a business school to fit throughout curriculum. And that''s where we stand with it today, is we''re working on driving these issues throughout the Anderson Schools curriculum. And I''d like to start just briefly with that, just to give you a sense of what we''re doing with that and then we''ll jump into the tax incentives piece. So here on the overview what we''re telling the students here when we''re working with the business school is we''re looking at disability stats and trends and why it matters to business; we look at it both from, like, a compliance standpoint, but also from an opportunity standpoint. So part of the place that we''ve taken this curriculum is into entrepreneurship classes for instance, saying "Look at the size of the market, look at the people that you don''t want to exclude from your small business as you get started in business." And that''s a message that''s really been resonating with our undergraduate and graduate students. And we''re also starting to pull that same message into our core curriculum in HR classes and into my field which is tax, saying "How does this impact? How does this influence with the tax code?" So a little bit of overview there... Here''s a conference we held here at the University of New Mexico almost a year and a half ago -- a year ago summer -- was the Access Meets Business Conference. The message was that good access is good business. And we''re promoting the case for inclusion and diversity, including people with disabilities as I''ve been mentioning. And so here''s some of the statistics and trends that you''re probably familiar with but our students and businesses in general may not be familiar with. And that''s what we''re trying to get the word out about, partly through this forum and through others. 20% of Americans have a disability. Disability does not discriminate. The largest percentages, 70% of disabilities are those that are hidden. And then here in my home state of New Mexico, one in five working age adults has a disability. So again, there''s the relevance for your existing business, your start-up business, market size, your employees -- you need to be aware of these issues, again from a compliance and from an opportunity standpoint more from the market opportunity standpoint that we discuss here at the business school. Again, disability is the largest minority group with more than 58 million members. Many times this is a totally untapped consumer market. And this untapped consumer market is over $200 billion per year it''s been estimated by the National Organization on Disability. And if you include family members, that market expands almost fivefold to over a trillion dollars. If you look in the big scheme of things as well in terms of demographics, baby boomers -- there will be over seventy-one and a half million baby boomers over age 65 by the year 2030. So this from a service standpoint, product standpoint, etc., this is a growing area that students and businesses need to be very much aware of. So thank you for that. I just want to go through that a little bit with you before we get into the majority of today. That''s our background as to context in which we''ve been addressing it here in Albuquerque. But onto the main point of this discussion, which is tax incentives and the ADA. So getting into this material, a starting point -- there was a study done about ten years ago by the Government Accountability Office looking at employer usage of tax incentives and business employment incentives. And what this study found was as of ten years ago, that in 1999 -- which is where they had the statistics to measure this -- was that 1 in 686 corporations and 1 in 1,570 individuals with a business affiliation used the tax incentive credits. So this was really surprising. I mean, given that this wasn''t real long after the enactment of the ADA, that this was not being utilized very much or effectively, these tax incentives. Of those that did utilize those, it was primarily healthcare and social assistance services; they accounted for approximately 31 million of the total credits that had been utilized at 59 million. So in terms of the conclusion of this study in 2002, the main takeaway was that the businesses were often unaware of these incentives. So there was a really large educational gap between the availability and the usage of these incentives. Well, to my knowledge there hasn''t been another study done since 2002, so I believe this would probably still be the case. And anecdotally speaking to people I know -- CPAs, business owners, etc. -- I believe this probably still is the case, that there is a large gap between ADA compliance issues and then an understanding or knowledge of some of the tax incentives that are available to help with those issues as well. So along those lines trying to help fill that gap, that''s where I was coming into is from a tax standpoint in the topic today. What we''re going to be focusing on during the remainder of this discussion are the two primary tax incentives that address the ADA and really, Section 44 -- this first one I mentioned, is one that''s directly on point with the ADA -- Section 190, this comes from the late ''70s. This is actually a deduction. It wasn''t particularly on point or as a result of the ADA, but it definitely fits into the mix in terms of these issues. So a little bit of background here before we get into more depth on the details of these tax incentives. It''s kind of important to know a little bit about the structure of the tax code, and that kind of informs a little bit about how these things are utilized and why they''re important. If you think about the tax rules as somewhat of a hierarchy, you can think of all the way from things that are nondeductible all the way down to things that provide a credit, which is the most valuable thing under the tax code. Okay, so drilling down on that a little bit more. If you think about your own tax situation -- your food, your clothing, your commuting expenses -- those sorts of items are not deductable for tax purposes. Okay? So in other words, there''s no tax benefit or tax incentive for personal types of expenses. So that would be on one end of the spectrum. Well, clearly that''s not what we''re talking about here. These items are going to provide some form of tax incentive. But moving up that spectrum somewhat, if expenses are incurred in a trade or business environment, then those expenses are deductable against the revenues of that trade or business. Okay? So that''s where you start getting into some tax benefit is if you''re doing it in a business context. Okay. As far as deductibility, you get into also some timing issues. If it''s deductable, it could be currently deductable, i.e. you can take it against your current -- your taxable income; or if it provides a long term benefit, say it''s you''re buying a building -- that would be a typical business expense -- but you can''t deduct that all currently because it''s going to provide a benefit over an extended period of time. And generally for the IRS that rule is that if it provides more than a benefit over 12 months, you have to do what''s called "capitalize" which means you have to include it as an asset on your company''s balance sheet and then you have to write off that amount over time so that you''re matching it against the revenue that it''s helping to generate. Okay. So again for instance if you build a building, typically under the tax code that could be a 39-year depreciation period for that building. So it''s deductable, but it''s deductable over a number years. So as we get into more detail about these incentives, that''s something to keep in mind: Some things are currently deductable; some things are capitalized and taken over time. And the quicker you can deduct something, that''s generally viewed as more of a tax benefit. And that will deal more with the Section 190 with the deduction aspect. The credit aspect -- the access credit -- as I mentioned a second ago, a credit is the most valuable item under the tax code in terms of incentives. A tax credit gives you a dollar-for-dollar reduction of your tax liability; therefore, that''s more valuable than a deduction because a deduction only gives you a tax benefit at your marginal tax rate. So in other words, a deduction reduces your tax, taxable income, that benefits you at whatever you''re multiplying that times in terms of your tax rate. But a tax credit is dollar-for-dollar, so all else equal that''s more valuable to taxpayers. And that''s going to be the primary focus we get into today is looking at this access credit, Section 44 -- when it''s available, when it''s not available, and then a little bit of the detail around that. As a quick overview of a couple bullet points here on this access credit, it is what''s known as a nonrefundable tax credit. So what does that mean? "Nonrefundable" means that you have to have a tax liability to offset before you get a tax benefit from this credit. So in other words, if you had a $20,000 tax liability and you had a $5,000 access credit, you''d be able to utilize it because you have that $20,000 tax liability to absorb the credit. Okay? And that''s the way most tax credits are under the tax code. They''re what''s known as nonrefundable. In other words, you can''t drive your tax liability negative with the use of this credit. And there''s very few credits in the tax code that you are allowed to do that with. So it''s nonrefundable and then also it''s part of the general business credit. Okay. The general business credit is an aggregation of all the credits that are available to business. So once you calculate each individual component that gets aggregated in one place, add it together, and that aggregate amount is what you look at to see if you have enough tax liability to utilize the credit. So in other words, as we go through this, the ability to utilize this efficiently and effectively is dependent upon the taxpayer to some extent: How profitable are you, what other potential credits you have, etc. So that will come into the use of these credits. Okay? So that was an overview. A little bit of background more now turning to specifically the access credit. This comes back in the early days of the ADA. Here''s a quote from the Joint Committee on Taxation''s background to this provision. Congress extended federal tax incentives to ease compliance with the ADA. Here''s the quote in particular: "The Committee is concerned" -- this is the tax committee -- "that the requirements contained in the Americans with Disabilities Act of 1990 may impose a severe financial burden on certain small businesses. Consequently, the committee believes it is appropriate to provide these small businesses with a nonrefundable income tax credit for a portion of the expenditures that are incurred in complying with the requirements of the Americans with Disabilities Act of 1990." Okay. So this is very important as we get into the application of this credit. Here''s what the objective was of Congress: It''s aimed at small businesses and it''s meant to help defray some of the compliance costs with the ADA itself and so with that as an overview, now getting down into some of the specific requirements. What I''ve got up here on the screen, this is the actual wording from Section 44. This gets into the definitions of what types of businesses qualify for this credit. So for an eligible small business, which we''ll get into in just a minute, what the credit is it''s an amount equal to 50% of so much the eligible access expenditures for the taxable years exceeds 250 but do not exceed 10,250. So I have these elements in quotes "eligible small business" and "eligible access expenditures" because those are two terms that are defined specifically in the tax code in terms of what businesses can utilize this credit. So here''s an example. Say the business incurs 12,000 of eligible access expenditures. If that''s the case, then that would qualify it for the maximum credit, which is 10,250 -- so the 12 is over the 10,250 -- minus the 250 base, times the 50%. So the credit would be $5,000. Nonrefundable. It would have to be applied against a positive tax liability. What is an eligible small business? An eligible small business means any business if: The gross receipts of the business for the proceeding taxable year did not exceed a million dollars. Okay. So again, you''re kind the seeing what Congress is aiming this at in terms of that committee report, defining a small business as: Not exceeding a million dollars of gross receipts -- so that would be your top line receipts, not your net income; this would be top line revenues before expenses -- or if the business employed not more than 30 full-time employees during the proceeding taxable year. So you can meet the eligible small business requirement either way, on the gross receipts basis or based on the size of the employee base of the business. Eligible access expenditures. These are amounts paid or incurred for the purpose of enabling the business to comply with applicable requirements under the Americans with Disabilities Act of 1990. And this is going to become critical as we get into this more about how this actually works out. In order for an expense to be eligible, it has to be for purposes of complying with the ADA. So again, some examples here in a few minutes but if a business is already in compliance with the ADA, the IRS has taken the position under this wording that if you''re in compliance, incremental expenditures would not qualify for this credit because this is designed to put you in compliance, not incrementally improve your compliance. So that''s the second bullet point. Expenditures in an area where the business is already in compliance with the ADA do not qualify for the credit. And we''ll look at a couple of court cases that put a little bit more explanation around this requirement. And here we''re getting into this next slide: What is exactly an eligible access expenditure? There''s multiple categories here. So this is really important stuff in terms of what falls into these. First off -- and this A, this is coming straight from the tax code -- eligible access expenditures for the purpose of removing architectural, communication, physical, or transportation barriers which prevent a business from being accessible to or usable by individuals with disabilities. So this letter A, this is more of the environment, whether it be physical or communication-wise that''s inhibiting access to the business. So those sorts of expenditures would be eligible access expenditures. Interestingly enough, as we go into this more today, this somewhat is evolving over time based on how commerce has evolved. So keep in mind the Internet, web access -- we''ll get to that in a few minutes. Letter B, eligible access expenditures also include expenditures to provide qualified interpreters or other effective methods of making orally-delivered materials available to individuals with hearing impairments. So a point I''d like to make on this before going forward, again, just to keep in mind is we are here, we''re talking about a business context saying this is a really important point. This is for purposes of the credit, this letter B. However, even if this did not qualify for purposes of the credit, this would still be a trade or business expense. So if your business is hiring an interpreter to comply with the ADA and meet the needs of your customers, that''s a trade or business expense which is deductable against your current year revenue. What this access credit is doing as I mentioned a few minutes ago is kind of shifting that expense to a higher level tax benefit where you''re getting a dollar-for-dollar tax offset as opposed to just at your marginal tax rate. And we''ll get into some examples here in just a minute. Letter C, eligible access expenditures also applies to qualified readers, tape texts, and other effective methods of making visually-delivered materials available to individuals with visual impairments. D, also to acquire or modify equipment or devices for individuals with disabilities. So modifications of equipment, devices that you need for your business, those items would qualify for the access credit. A case that we''re going to look at in just a minute really emphasizes the purpose of why you''ve acquired that equipment or device. So that''s something to keep in mind is documenting why you are obtaining this equipment and how it helps you comply with the ADA and meet the needs of your customers with disabilities. And then E, to provide other similar services, modifications, materials, or equipment that''s meeting the objectives of complying with the ADA. So again here, keep in mind documentation, especially written documentation. So if you''re ever asked about this you can show that linkage between the expenditure and the compliance issue. So here''s an example pulling together some of these items I''ve been talking about the past few minutes. An example, Joe''s Flower Shop -- and this is about as creative as accountants get -- Joe''s Flower Shop incurs 20,000 in building modifications to meet ADA requirements. This amount qualifies as an eligible access expenditure. So I''m just kind of saying here this is just a given that their credit is 20,000 to meet ADA requirements. In terms of this, the business is allowed a credit of 5,000 for these expenses -- that would be the 10,250 maximum minus the base amount of 250 times 50%. So that''s a $5,000 credit against the tax liability. However, in addition to that amount, Joe''s Flower Shop can take 10,000 as an access deduction, which we''ll get into in just a few minutes on the deduction side. So you''re required under Section 44 to reduce the amount of your eligible expenses for deduction purposes by the amount of any credit that you''re claiming. So that''s this 15,000 -- and I''ll show you in a minute where this is coming from -- less the 5, which is the credit. So that''s a $10,000 immediate deduction which is going to provide a benefit at your marginal tax rate. And then the remaining amount would fall under the typical rules for, say, building modifications, which would be capitalization, i.e. putting it as an asset on your balance sheet and then depreciating it over a period of time where you get that deduction over a number of years. So at the end of the day on this you spent $20,000. In terms of how this is helping the small business, potential tax benefit is the direct $5,000 credit. And here I''m assuming a 30% marginal tax rate. So the deduction would provide a $3,000 tax benefit. That''s the 15,000 minus the $5,000 credit. So a $10,000 deduction, 30% is 3,000. And then the depreciation, I made an assumption that it''s some sort of an item that you could depreciate over five years. So that at the 30% tax rate gives a current $300 tax benefit. So utilizing these incentives, $20,000 expenditure. In this example you could come up with $8,300 of tax deductions to help defray that cost. Another example not so much on the capital expenditure side, but more on a business expense type of expenditure is this: If Tom''s Car Lot pays 1,250 to hire a sign language interpreter to assist in finalizing sales to customers with a hearing impairment -- this amount qualifies as an eligible access expenditure as it went over above -- the business is allowed a credit of $500 for this expense. That would be the 1,250 minus 250 times 50%. And then in addition, the business can deduct 750 as a current period business expense. So a little bit more discussion on this, If you had this expense in conjunction with a capital expenditure, you''d have to aggregate those expenses together in terms of the overall access credit. So just to put some context here, I''m looking at this as standalone, as if this was your only eligible expenditure for the year. So if you had the 1,250 you''d have the $500 for the credit, and then 1,250 minus 500 -- that gives you the $750 which is eligible as a current year trade or business expense, which you would get no matter what because that''s an expense of operating your business. And that falls under the general tax rules. Overall, again, this is nonrefundable credit. It falls under the rules regarding the general business credit. And that imposes an overall limitation on all business credits that are available to a business. And what I''ve listed here on the slide is that overall limitation. The use of the general business credit is limited to the excess of regular tax over tentative minimum tax, which you may have heard of is called alternative minimum tax -- that''s what that''s referencing -- or regular tax exceeding 25% of regular tax exceeding $25,000. Okay. So here we''re getting into a little bit of what tax gets a bad name for, which is the complication regarding how you implement these things. Sometimes Congress giveth and then it also could potentially limit through these types of means. But in a practical application, here''s an example of what this would mean. So again, back with say Joe''s Flower Shop. Say Joe''s Flower Shop has a general business credit of 13,000 in this example made up of say 6,000 of the access credit. And then I threw in here say 7,000 of work opportunity credit, which is also part of the general business credit. If the business has a regular tax liability of 30,000 and a tentative minimum tax of 24,000 -- which is the alternative minimum tax -- in that situation the business would be able to utilize $6,000 of that $13,000 credit in the current year. Okay. And then this second part of this limitation. But the one that''s binding here is this first one, 30 less the 24. So it would be 6,000 for the current year. What you''d be allowed to do with the excess is it gets carried back to the prior year; you could see if you could utilize it in the prior year. And if you could not, then it gets carried forward for up to 20 years. So you would get an opportunity to use it, you know, prior year or in the future years if you couldn''t utilize it in the current year. But again, the higher the tax liability you have, the more potential that you''re going to be able to currently use this tax incentive. So back to a little bit more about what eligible access expenditures are in terms of this credit. The IRS hasn''t put out a lot of guidance out about this, but the guidance it has put out has taken a fairly restrictive view of what is meant in terms of the eligible expenditures. And specifically here I''m going to address what''s meant by acquiring or modifying equipment or devices for individuals with disabilities. So the first bullet point, the reason the IRS has taken this restrictive view is that under the code section itself is that that expenditure to qualify for the credit must be to put the business in compliance with the ADA. So the second bullet point, the IRS has taken the position that if the taxpayer is already in compliance -- even at a minimal level -- the expenditures cannot be treated as qualifying for the credit. Okay. So if you''re already in a mode where you''re meeting the requirements of the ADA, if you do something over and above that, that could be a trade or business expense, it could be a depreciable item, but it''s not going to qualify for purposes of this credit. The IRS''s main outline of its approach was put out in 2004 in a Chief Counsel advice memorandum. And here''s the site for that if you have any interest in looking this up or passing this along to your CPA, etc. So along those lines here''s a case that applied the IRS''s view of how this works to a specific instance. So this is Stan [assumed spelling] versus Commissioner. This was a tax court case. What happened in this case was the taxpayer was a dentist. And the dentist claimed a credit for expenditure for a piece of sophisticated X-ray imaging equipment. Okay. So the dentist''s argument was that this equipment allowed for onscreen communication and highlighting of issues with patients. And given that capability, the doctor stated this allowed him or her to communicate more effectively with deaf patients because it was up on the screen as opposed to however else he''s trying to communicate. Well, as it turned out in this situation, the dentist was already communicating with patients as needed utilizing handwritten notes. So in the context of this case, the IRS argued and said, "You''re already complying with the ADA via your communication with handwritten notes; therefore this does not put you into compliance with the ADA because you were already in compliance with the ADA. Thus this piece of equipment does not qualify for the credit." And the tax court agreed in this specific fact situation. Again, here I want to emphasize that does not mean that there was no tax benefit at all for this equipment. What the dentist would have to do in this situation, then, is: Capitalize the equipment, put it on the balance sheet as an asset, and then depreciate it under the general tax rules. Or if there was some other tax incentive outside of this scope that he could utilize, he could utilize that. But it did not qualify for purposes of the access credit. Well, we started with the bad news. Here''s -- this next item is more of a good news type of situation relative to this type of issue. This next case I''ve got up here, Hubbard versus Commissioner, tax court memo 2003-245. In this situation the taxpayer was an optometrist claiming a credit for an automatic refractor system. So in a way on the front end -- not too dissimilar from what was going on in the dentist''s situation -- this refractor, what it did was it took measurements of the patient''s eyes to provide an estimate of the corrective prescription. And this took the place of manual equipment of reading charts from a distance. Well, in this case the optometrist made a very effective argument that the reason for purchasing this equipment was that many of the optometrist''s disabled patients were not able to be treated due to the physical constraints of the manual system; therefore, the optometrist purchased the equipment to meet the requirements of the ADA and to meet the needs of those patients with disabilities. Well, based on the documentation that was offered by the optometrist in showing that linkage between the purchase of the equipment and the services that were being provided, the tax court held that that did qualify for the credit even though that equipment could be used for individuals with disabilities and individuals without disabilities. The primary purpose of that purchase was shown to go into compliance with the ADA. So that''s kind of the moral of the story between these two cases, is showing that linkage between the expenditure qualifying for the ADA and that rationale as opposed just to a general purchase that may have some ancillary benefits for patients or whatever the service is of individuals, customers with disability. So along those lines, that pulls us into a little bit more about the website, the Internet-type of approach to whether it qualifies for these credits. Again, referencing that same Chief Counsel advice memorandum. In that same Chief Counsel advice memorandum the IRS took the position that website expenditures do not qualify for purposes of the ADA. Okay. What we''ll keep in mind -- this was in 2004, so this is eight years ago -- things in terms of the business environment continued to evolve quickly. The service held this first bullet point that: That the language of the ADA referred to a physical environment, and therefore by written definition in the section itself it didn''t qualify for the web access. Bullet point two: Therefore web-based expenditures were not eligible for either of the access credit or -- stop here, should be the access deduction. And in three: In this analysis the IRS reiterated the Department of Justice promulgates the regulations interpreting the act. Okay. Well, this third bullet point is really key in terms of the tax incentives that we''re going to go into and how they''re applied here in just a few minutes. The IRS recognizes that it does not have primary authority obviously over how the ADA is implemented; that belongs to the Department of Justice. So the IRS is obligated to follow the Department of Justice''s regulations in terms of stating what the ADA applies to or does not apply to. So in other words here in terms of this website access, to the extent the Department of Justice agrees that websites fall under the ADA, well, then that also opens up the opportunity to utilize expenditures on those types of items for purposes of the access credit because, again, the IRS is going to the follow the Department of Justice''s application of the ADA. So moving forward here, the Department of Justice regulations regarding website accessibility, this is coming from the 2010 regulations. This is a statement from the Department of Justice: "The Department has consistently interpreted the ADA to cover websites that are operated by public accommodations and stated that such sites must provide their services in an accessible manner or provide an accessible alternative to the website that is available 24 hours a day, 7 days a week. The final rule, therefore, does not impose any new obligation in this area." This was a preamble explanation to those 2010 regulations basically stating that websites are a form of communication related to the commercial environment of the business; therefore, it has to be accessible in some form to individuals with disabilities. Well, where does that then pull things in terms of the tax rules? And I haven''t seen anything formally about this from IRS, but I think this is an arguable point based on what the IRS said in that 2004 Chief Counsel advice memorandum is this first point: "Based on the Department of Justice''s regulations in the IRS''s deference to these rules there''s a strong argument that cost incurred to enable website accessibility qualify for the credit." I think that''s a strongly arguable point. It''s probably unlikely that businesses, or especially small businesses will be providing 24 hour a day alternatives to website access. So again, arguably the cost of building out that website to make it accessible could very well qualify for that access credit. Now, keeping in mind it''s not huge dollars, but $5,000 credit plus the deduction might make the difference in terms of whether something''s economical or not to a small business. A couple other bullet points here. This could fall in lines with the federal standards in terms of what that website might look like and how the accessibility might work. Also a job accommodation network provides tips on designing an accessible website. So again, there from a small business'' standpoint, putting those sorts of attributes in place, I think there''s a pretty strong argument that could fall back under the qualifying for purposes of the access credit. So moving on and that was the discussion of the overview of the access credit. I want to turn now to what I''ve deemed here or called the access deduction. This is the Section 190 deduction that I showed at the beginning overview. This is the item that''s been in the tax code for a long period of time -- since, like, the late ''70s. As I mentioned previously, the deduction, this would be an exception to the general rule of capitalization and depreciation. So an amount that qualifies for this deduction, you do not have to capitalize and depreciate; you''re able to expense it immediately against your current year income. Second bullet point, this applies to businesses of all sizes. So there is no small business test like there is for the access credit; there''s no million-dollar gross revenue requirement; there''s no 30 or fewer employee requirement -- applies to all business sizes. So that''s the good news. The bad news is that it''s somewhat limited. It''s limited to $15,000 of expenditures in a given year. And in fact, this amount was reduced in 1990 to offset enactment of the Section 44 credit. So I didn''t put it in here, but if you look back at the Joint Committee of Taxation''s notes on the enactment of that tax provision, it reduces I believe it was 35,000 from Section 190 before down to 15,000 and then they moved that incentive over to the credit side. So what does this apply to? A taxpayer may elect to treat qualified architectural and transportation barrier removal expenses which are paid or incurred by him during the taxable year as expenses which are not chargeable to a capital account. So again, what that means is that you don''t have to show as an asset and depreciate; you''re allowed to deduct them immediately. And that''s what it says here: "Expenditures so treated shall be allowed as a current year deduction." So what does this mean? Architectural and transportation barrier removal expenses. This means an expenditure for the purpose of making any facility or public transportation vehicle owned or leased by the taxpayer for use in connection with his trade or business more accessible to and usable by handicapped and elderly individuals. And this terminology and this wording, this is coming from say, like, the late ''70s. But that''s the point here and it''s still in place today that if you''re doing something in your business that you are doing to meet architectural standards to make items more accessible, at the very least it will qualify for this access deduction. And more specifically, this is coming from the regulations for this: Qualified architectural and transportation barrier removal expense -- removal expense with respect to which the taxpayer establishes that the resulting removal of any such barriers meets the standards of the Architectural and Transportation Barriers Compliance Board. So this was the forerunner of the Architectural Standards Board that''s in place currently. Still that continuity is in place. Meeting those standards would qualify that expense for purposes of that access deduction. What types of individuals does this apply to in terms of creating more accessibility? It applies to barrier removal for any individual who has physical or mental disability, including but not limited to blindness or deafness which results in a functional limitation to employment or who has any physical or mental impairment, including but not limited to a sight or hearing impairment which substantially limits one or more major life activities of such individual. So pretty broadly-worded in the tax code relative to current wording that barrier removal to help individuals with disabilities have more access would qualify for this access deduction. Okay. So those were the overviews of "What are the two main incentives," which are the access credit, which has more specific requirements and then the second, which is the access deduction. And again, just to kind of summarize a few points, they could potentially fall for -- cover the same type of expense. The better of the two is the credit because it''s dollar-for-dollar reduction. Once you utilize the credit or if you can''t utilize the credit, then the access deduction itself -- if it''s a qualifying expense -- would allow immediate expensing of up to $15,000. So that''s the overview. And where I''d like to turn now is in terms of more recent guidance in terms of "What are standards for the ADA?" and how that would apply to these requirements under the tax incentives. So trying to push down a little bit further about how this might work in practice currently. So readily achievable barrier removal, so I assume probably most people on the call on the webinar are familiar with this. Businesses and nonprofit organizations that serve the public are to remove architectural barriers when it is readily achievable to do so; in other words, when barrier removal is easily accomplishable, enabled to be carried out without much difficulty or expense. Okay. So here''s where it starts to get a little bit more complicated in terms of the interaction especially with the credit. So for instance, if you can document as a business that it''s not readily achievable -- and in other words it puts too much of a financial burden on your business -- arguably, you would be in compliance with the ADA. So in other words, you at that point would be in compliance; however, over time as it becomes more readily achievable to do so, you would become obligated to make the adjustments that are required. Well, that''s where the tax incentives would come back in because at that point you need to comply with the ADA so you''d be potentially eligible for utilization of those tax incentives. So more along those lines, readily achievable barrier removal tax incentive implications, once the barrier removal becomes readily achievable, as required under the ADA, therefore you would be incurring that expense to qualify for the ADA. So that should have a pretty high likelihood of qualifying it for the Section 44 credit. And also if it''s for barrier removal, it would also qualify as an expense for purposes of the Section 190 deduction. So as you move, as the business grows, as it becomes more readily achievable, these credits could be become available or the deduction could become available currently. So along those same lines about recent guidance and about how it applies with these tax incentives, so the 1991 ADA standards for accessible design: "Elements of facilities built or altered before March 15, 2012 that comply with the 1991 standards are not required to be modified to specifications in the 2010 standards." Okay. Well, what''s the implication of that to the tax incentives? Well, number one, that would say that if your building was built, say, after 1991 you were required to have that building be up to ADA standards that were in place under the ''91 standards. Therefore, anything following that is not going to be a qualifying expense for Section 44 credit because it''s assumed -- and this states this in Section 44 -- new construction after ''91 not eligible for the credit. However, recall that for Section 190 it doesn''t require as much of those specific criteria, so it could very well likely be a qualifying expense for the Section 190 deduction. Moving forward to the 2010 ADA standards: "Elements in facilities built or altered on or after March 15, 2012 are required to meet specifications in the 2010 standards" so again, what does this mean? Well, what it means is new construction is not a qualifying expense for the Section 44 and I was just talking about that. Under Section 44 new construction does not apply; however, now we''re starting to branch out a little bit and where these credits and this understanding of the deduction might be able to help even more is an alteration under the Department of Justice regulations is defined separately from new construction. Well, following March 15, 2012 any alteration is required to meet the 2010 standards; therefore, the expenditures put in place to meet those standards in my opinion would likely qualify for the Section 44 credit because if you did not have that expense, you''d be out of compliance with the ADA, it''s not new construction, and it''s meeting this new higher threshold of 2010. So again, arguably I think that would qualify for the Section 44 credit. And then finally here I don''t think there''s any question that under the 2010 ADA standards the qualifying expense for Section 190 would still be in place and would be available for -- up to that $15,000 deduction -- for barrier removal. So some examples of that that come into play under the 2010 rules or maybe just in general. Examples of potential alterations: Accessible parking spaces. If you''re now having to do an alteration, say, like you''re restriping your parking lot -- now you''ve moved from the ''91 standards to the 2010 -- you can arguably, I believe that should qualify for purposes of the Section 44 credit because now you''re required to meet the 2010 standards for that alteration, i.e. it''s not new construction. Second bullet point: Parking access aisles and following here -- counters, self-service drink dispensers, accessible tables. As the business makes alterations, the things that used to be in compliance and arguably I believe those would qualify for purposes of the Section 44 credit. And again, if you max out on that, you''d be able to deduct anything over and above that up to the $15,000 as I''ve described previously. Along those same lines of the interaction with the 2010 ADA standards, new elements in the 2010 ADA standards. The 2010 standards contain elements that are not in the ''91 standards. Because these elements were not included in the ''91 standards, they are not subject to the safe harbor exemption. So in other words, if you''ve had something built in your building that was under the ''91 standards, you had that safe harbor where you met those requirements. So you did not have to alter them to upgrade them to the 2010 standards; however, for elements that were not in those ''91 standards under the new 2010 standards did not fall under that safe harbor, so to the extent it''s readily achievable, businesses are required to move those up to the 2010 standards, as I mentioned here as it''s readily achievable to do so. Well, again what does this mean in terms of the tax incentive implications? Well, again I believe that that would be a qualifying expense for the Section 44 credit because in a sense now we''ve had something that wasn''t addressed previously, it''s not new construction, you''re having to upgrade it to the 2010 standard to be in compliance with ADA; therefore, the rules I went over regarding Section 44 credit should apply to those expenditures. And again to the extent there''s overlap would also qualify if it''s regarding barrier removal for the Section 190 deduction. So as an example, the [inaudible] use for the elements of the 2010 ADA standards that were not -- that were new elements that were not included in the ''91 standards, these elements included recreation facilities such as swimming pools; team or player seating; accessible routes and quote "sports facilities"; saunas and steam rooms; etc. And I know there''s been some controversy around these in terms of the timing of when businesses have to implement. Well, hopefully in terms of the tax incentives this would be something to where this would come back into play like it did in the early ''90s where that would be able to be applied to assist in trying to make these a little bit more financially doable for businesses. So here''s an example. Say there''s a readily achievable modification to a swimming pool that is made by installing a lift. This cost should qualify for the credit and deduction purposes. So again, this is a new element that wasn''t in the ''91 standards. It is in the 2010 standards. So if the business is putting this in place to meet the requirements of the ADA, that cost should fall under the examples above about how you would be able to take the credit and then if it''s over and above that potential deduction portion. Okay. Well, I know that''s a lot of information quickly. We''ve left around 20, 30 minutes or so for questions. So that''s what I had in terms of my presentation. I pass it back to Marisa to open up the questions regarding this material.
Thanks, Craig. We''ve had a lot of really good information today, I know that. Once again, I want to just go ahead and remind folks you can type your question into the chat area there and we will see it and ask it. At this time I would also like to instruct the operator that we are ready for questions. So if you could please provide instructions to those participants on the telephone line.
Certainly. Ladies and gentlemen, if you''d like to ask a question on the phone line, please press star then the number one on your touch-tone telephone. Marisa Demaya: And in the meantime, I''ll start with a question. First question: For businesses with multiple locations, is the deduction per location only, or would it be only one for the business? Craig White: My understanding there would be that it would be for the business itself. And so you''d aggregate across locations for the business. So say you had a corporation that had multiple locations, all of those expenditures across locations would be aggregated together for purposes of these limitations. Marisa Demaya: Okay. Next question: If a project to remove barriers stretches from one year to the next, can that cost be divided between tax years? I know you spoke a little bit about that maybe earlier; can you clarify?
So the question regarding if it''s a multi-period expenditure to become in compliance, I think off the top of my head there you''d have to look at if there is elements that you could break out in terms of objectives that you''ve met in terms of completing that. If it''s one overall project, I''d say it would be in the year in which you complete that project is where it would qualify. However, if you could break it down into subunits, you know, say like you''re fixing the counter space or you''re striping your parking lot at a different time, break into subprojects, then at that point I think you have a better argument to say, "Okay, this qualifies in this period or this qualifies in the second period." However, if it''s one unified portion, I think it would follow your general accounting rules, which would be you take it into account when you completed that project. Marisa Demaya: Okay. Operator, just wanted to check real quick, are there any questions on the telephone line?
Not at this time. Marisa Demaya: Okay.
I''m sorry. We do have a question now. We have a question from [inaudible]. Your line is open.
Yes. These tax credits, would you further elaborate? Would they be available to a business that uses national service employees, being AmeriCorps? Thank you. Craig White: A business that uses national service employees. The main portion, the main criteria as to whether the credits would be available or a benefit in terms of my talk today would be whether the business is for-profit or not-for-profit. Okay? So these credits are really designed for for-profit businesses. So in terms of tax credits or the deduction, really, there''s no tax benefit unless that business has potential tax liability. If you''re talking in a nonprofit sector, there may be some other incentives that could come into play but not really so much from this point of view via the tax code. Marisa Demaya: Okay, moving on. For a small business using the tax credit, how should they document accommodations made for a customer or a patient providing an interpreter, say, for a deaf patient?
Okay. I think there, if I understand the question properly, would be along the lines of your typical what you''d want to document for anything in terms of tax preparation: You''d want to note the expense, at that point in time maybe some sort of a log, you know, along with the invoice from the interpreter saying, "Here''s what it was utilized for, here was the business purpose, here was the date, and here''s the person that benefited or here''s the point in time it benefited" and keep that as documentation for purposes of not just this credit, but also for the potential business deduction itself.
Okay. Okay. Next question: Could you clarify on what is considered to be an eligible access expenditure under the credit? For example, if we have made a modification in the past to our accessibility, but it wasn''t necessarily the best modification and we would like to improve it or replace it, say for example a ramp that we put in. If we wanted to remodel, would that then be considered an eligible expenditure?
That''s a good question. To my understanding it would depend upon whether the original modification or alteration had the business in compliance with the ADA. Okay? So if the original was of a quality of such that it was in compliance with the ADA, a further improvement over and above that I don''t believe would qualify for the access credit because, again, the business would already be in compliance with the ADA; however, I think this would be a situation where that deduction could come into play -- the Section 190 deduction -- where your argument would be that this is done to enhance accessibility to the business. So rather than having to capitalize it and depreciate it, you would be able to deduct that currently up to the $15,000. So I think that''s how that would play out for an improvement to an existing modification that already meets the requirements of the ADA.
Okay. Just a quick check in. Folks, again, you can submit your questions there in the chat area of the window. And operator, are there any questions on the telephone line at this time?
Once again, if you''d like to ask a question over the phone lines, please press star then the number one on your touch-tone telephone.
Okay. In the meantime another question says: I currently teach a motorcycle certification course. It''s a small course, about five to six students per class. I do not make more than $1,000 per class, which I only teach about twice a year. I have on occasion received a request to provide an ASL interpreter during my class. And it has resulted in costing me a lot more than I make for the entire class at times because of the length of the time involved, 10 to 15 hours per class. Could I claim the tax credit for this type of expenditure, and if so, am I allowed to go back and claim this credit for the previous year in which I provided an interpreter for that student in my class?
That''s a great question. That''s exactly the sort of information we want to get out on this. Because the case there would be -- and I don''t claim to be an expert about what''s readily achievable or not, that''s part of the reason to collaborate with the experts in the ADA -- but given an assumption that it was required and was incurred that expense to create access for this motorcycle certification course, that should qualify for purposes of the access credit as I outlined above. And again I''m assuming this is small business and you meet the other requirements. So I would say yes, that would qualify for the credit. And in terms of other open tax years, you could go back, and with that documentation you could amend those earlier tax return years and basically say you''re modifying because you were eligible to claim that credit but you did not do so even though you were. So you could also amend those prior returns.
Well, that''s great information, Craig. Okay. Here''s another one: I was just wondering if you knew what types of documentation the IRS uses such as in the case you described Stan versus Commissioner; how does the IRS determine whether or not someone is currently in compliance if it is not immediately obvious, say, is it flagged for audit?
Yeah, another good question. [Laughter] So if I''m understanding you right, I mean, just in terms of the way the tax law is usually implemented. You know, you say you claim this credit, you claim the deduction, you -- it''s a self-enforced system in general. So you would have to understand each role in saying why I''m doing this for purposes of the complying with the ADA and you claim the credit. Well, in terms of the IRS knowing whether you really were or not wouldn''t really come up unless you were audited. Okay? So that''s the point at which you would have to have your documentation where you''re saying, "Okay, here''s why I qualify for this credit because I was trying to meet this certain customer need, etc." And I would point you back to that optometrist case where that one has a lot of good information about the sort of documentation the optometrist utilized. For instance -- I can''t go into all the detail on this case -- but they kept records of their number of customers with disabilities; they talked about the distance to the nearest optometrist. You know, they were in an area where the next optometrist was, you know, tens, hundreds of miles away; therefore it made it really important to individuals with disabilities to be able to access this optometrist in particular. And that was one of the key factors was that it was needed and it was primarily for providing access to the individuals with disabilities.
Okay. Going back to our previous question for a second, someone''s asking: How many years back can a business amend their tax returns? So how far can you go back if you wanted to do that?
You can go back three open tax years. So say 2000 -- well, when we get done here with 2012, you''d be able to amend up to three parts, it would be 12, 11, 10. Or potentially what I probably said [inaudible] because today''s October 16th, yesterday was October 15th -- the final extension due date -- so, you know, one close potentially going back three years prior. But that''s a general rule is you can amend up to your three prior tax returns.
We do have a question on the phone line. Marisa Demaya: Great.
We have a question comes from the line of the Participant. Your line is open.
Yes I have a question: Most of these tax credits that you''ve talked about have applied to customers'' use of a business; what if a business is making these kinds of expenditures for an employee?
Yeah, good question. That would be also in terms of the credit, as long as it''s for purposes of compliance of the ADA regarding the physical environment, you know, as customers or employees that would qualify. And then clearly on the deduction side it''s both either for employees or for customers. If that''s what the barrier removal is for, that would also qualify. So it''s both internal and external.
Okay. Are there any other questions on the telephone line at this time?
There are no additional questions on the phone line.
Okay. Next question I''ve got is: If a company isn''t necessarily required to comply under ADA but they make a modification anyway, can they still qualify for the access credit?
That''s a tougher one. If you''re not required to comply -- let me start with the good news first. I mean, clearly if you''re doing something for barrier removal to meet the access board''s standards, that would qualify for the current deduction -- up to the 15,000 and beyond that again with capitalization, depreciation -- I believe, you know, based on what I''ve seen from the guidance that the IRS upon audit, if you came in, if you were already in compliance with the ADA, that that would not qualify for purposes of the credit. And part of the reason I state that is just the kind of a hard-line approach the IRS took in terms of the dentist case that I laid out there with the use of handwritten notes. You know, I said, "Okay, if you''re already in compliance, then anything over and above that does not qualify for purposes of the credit."
Okay. And another question just came in: Are these tax credits applicable to government entities such as a city or local government entity?
Well, again yeah, good question in terms of whether they''re eligible for government entities. These credits, again, would be if that entity for some reason was taxable. So if there was some reason it was doing some sort of a taxable business where it''s taxable under the federal tax code, that''s where these would provide a benefit; however, if it''s not a taxable -- it''s nonprofit or a particular government entity -- then these provisions aren''t really going to provide any incentive for purposes of helping to comply with the ADA. Marisa Demaya: So they would -- just to clarify -- they would have to have some taxable income or --
Yeah. They would have to have some sort of tax liability, taxable income; it would have to be some sort of a taxable business entity. So if it''s a typical government entity it''s not subject to federal taxation, well, then these would not really be applicable in that type of situation.
Okay. Just wanted to check with the operator. Are there any questions on the telephone line at this time?
There are no additional questions in the queue.
Okay. And just a quick reminder to folks in the online platform, you can type your question in that chat area. And I''ve just received another question: Hi. Just wanted to clarify regarding online stuff. We sell blinds and window treatments online through our website; however, our website is technically not in compliance. Based on what you said earlier, would we then be able to claim the credit to help cover the costs of designing our new website for compliance?
Yeah, good question. This is an area in which the IRS is [inaudible] somewhat vague from 2004 up through 2012. But the point I was trying to make there in the materials is that the IRS has stated that it follows Department of Justice''s requirements in terms of compliance with the ADA. So given that your website, if it is out of compliance with the ADA and you are incurring those expenses for purposes of removing that noncompliance, I would say yes, that there''s a very strong argument there to qualify for the access credit because it''s moving you from a point of noncompliance to a point of compliance regarding your business. So again, yes, I think that credit would be available to help defray the cost of updating that website. Marisa Demaya: Okay. Next question: Could our hotel business use the credit to apply to bringing our swimming pool into compliance?
I believe so. That would be, I think, relative to that last example I was talking about there where under the new 2010 standards prior to that under ''91 my understanding is there''s nothing in there regarding the swimming pool. Well, now under the 2010 elements, since that''s new it doesn''t fall under the safe harbor. So yes, the swimming pool -- modifications to that pool -- to put it into ADA compliance, that should qualify for purposes of the access credit and then over and above that the deduction as well.
Another question: You mentioned early on in your presentation a lot of times businesses are not aware of these incentives; is there a website or a particular organization that we can refer to for looking into some of these tax incentives? Thank you.
I''ve done some review, and part of the reason I was interested in putting this out, I haven''t seen much about this in particular about the tax incentives. It''s mentioned in quite a few of the ADA materials, like there''s a small business primer that will reference the tax incentives. So I''m not as seeing much in terms of general information on this. I guess in answer to that, if you think this may qualify or your business may qualify, probably the best place to go would be if you want to do further research, you can go to the IRS website -- www.irs.gov -- and you can search on these credit names and pull up the forms and instructions relative to those credits. And that''s probably one of the best sources of seeing exactly how to document and how to report this to the IRS to take advantage of them.
Okay. Here we go. Another question: Complying with Department of Justice (DOJ) standards, if making modifications as part of a settlement agreement, could the business then still use the tax credit or deduction?
If I understand the question correctly, I believe so. If this is some sort of settlement with the Department of Justice in terms of coming in compliance with the ADA, well, then in my mind that would clearly state that that was the reason why those were put in place was for compliance with the ADA. So therefore, unless it''s new construction -- must emphasize that -- new construction may not fall under this credit, but if it''s some sort of alteration or other aspect that I went through, then I believe yes, that would qualify for the credit.
Okay. Another one: Someone''s asking if you could talk a little bit more about how some of these credits apply to, say, healthcare facilities.
How the credits apply to healthcare facilities?
Yeah. Do you have maybe an example or two?
Well, I guess my answer to that would be just from a general standpoint. Again, the healthcare facility would have to be a for-profit business. And then it would have to be for some sort of a barrier removal or one of the qualifying eligible expenditures and whatever the on point thing is with what healthcare facility is needed to comply with the ADA. And if that''s the case, then that would be what qualifies in general for the credit.
Okay. And could you clarify a bit on for-profit? Would that mean that the healthcare facility, say, if they take any type of, you know, if they accept Medicare or Medicaid, does that put them in a different category, or would they still be considered for-profit?
When I say "for-profit," again, that kind of goes back to the initial point about whether there''s a tax liability or not. So if you''re talking about, say like a 501c3 organization so -- and I''m not sure that would be for the hospital -- but if it''s a nonprofit organization, well, by definition it doesn''t have any tax liability because it''s not subject to the federal income tax. Therefore, incentives that help save tax money don''t really apply to that type of situation. So "for-profit" would just mean it''s not one of the tax exempt types of businesses that are listed in the tax code 501c3, etc. So if it''s something that''s operating for-profit that it''s going to have as a taxable profit, that''s where it would fall into these in terms of getting the benefit of the tax incentives.
Okay. Just a quick check in with the operator. Are there any questions on the telephone line at this time?
Not at this time. Marisa Demaya: Okay. Next question I have, Craig, is: With regards to a business providing reasonable accommodations to an employee, you had said earlier that they could take a tax credit if they were providing this to an employee; what if they were also working with, say, a State Department of Assistive or Rehabilitative Services? So they were working in conjunction with them, the employee, but they were still providing certain accommodations; would they still be able to take the tax credit?
Well, let me make sure I understand the question correctly. So they''re providing accommodations themselves but also working with the state to provide accommodations?
Yes. They''re wanting to know if that in some way affects their ability to still take the credit.
Not that I could tell from that amount of detail in the question. See again -- well, it''s just kind of generalized. The key would be the outflow of cash. So if you''re spending money to provide accommodations to meet the ADA requirements, that''s going to be the key to eligibility for the credit. Now, if working with the state reduces the amount you have to pay -- if that''s kind of where that''s going -- then that would just reduce the amount of out-of-pocket expense that could qualify for the credit.
That makes sense. Do you have any examples to name in your experience that of items that, say, businesses have tried to deduct that weren''t quite appropriate?
Well, in terms of the credit or the deduction, I don''t. I guess I point back to -- well, I do. Here''s a kind of a classic thing that the IRS came up with. If you do more research into this, there was basically a tax sham where home-based businesses were buying pay phones -- this was about 10, 12 years ago -- and claiming that the reason why they purchased these were to give access to individuals with disabilities. Well, it turned out that was really just a sham in terms of trying to create expenses that would create this credit that was more than what they were spending on these phones themselves. So in general terms -- this falls under general tax law -- it has to be for true trade or business expense, it has to be truly for the objective that''s stated in compliance here, in this case with the ADA. If those truly are the substance and you''re trying to act in good faith, that''s generally going to be what you need to qualify.
Okay. I don''t think I have anymore questions at this time. So just a quick check with the operator. Are there any questions, any other questions that have come in on the telephone line?
There are no further questions in the queue.
Okay. Give it just a second to see if any other questions are popping in on our platform. I think we are actually almost at the end of the hour anyway. So I want to go ahead and thank you again, Craig, for joining us today and sharing your knowledge with us. Just a quick -- this concludes today''s ADA audio conference session. We realize that there may still be some questions out there for our presenter, Craig White, so we apologize if we didn''t get to those. We will certainly -- we can certainly email those to him. So if you would like to submit any questions today that we didn''t get to or we didn''t see, feel free to email us, the Southwest ADA Center at firstname.lastname@example.org. And again, we can send those questions on to Craig and he''ll share the answers with us and we could share those with you all and perhaps post them along with the archive file for today''s webinar. Again, we want to thank you, Craig, for sharing your time and your wonderful knowledge with us today. I think everyone learned a great deal from our program. Just another reminder that today''s session was recorded and it will be available for viewing within the next 24 hours at www.adaconferences.org. And lastly, we invite you to join us for the next scheduled session on November 13th, which is an ADA case law update with presenters Barry Taylor and Alan Goldstein from Equip for Equality. Questions regarding this or any other sessions in the series can be directed to (877)232-1990 or via email at email@example.com. Again, you''ll receive a link to the evaluation via email at the conclusion of our program today. We certainly encourage you to participate and share your feedback with us, as it is always appreciated. Thank you once again, Craig, for sharing your great experience and your knowledge with us today. Thanks everyone for joining us. You may now disconnect from the webinar platform.
And thank you, Marisa, and thanks to everyone as well. Appreciate it.