Kevin Sullivan, P.E., LEED AP BD+C
Contractors play a vital role in many aspects of a building project including cost control, scope, schedule, constructability, safety, etc. These responsibilities are not only invaluable for a successful project, they’re incentivized by some very powerful federal and state tax incentives.
R&D Tax Credit
The Research & Development Tax Credit is the most powerful tax incentive for businesses in America today and is available at the federal and state level (in over 40 states including Texas and California). Most qualified expenses are for wages paid to employees and can include work under contract. See more here. Some qualifying activities include:
- Preconstruction Services
- Value Engineering
- Means & Methods
- Fabrication of equipment and systems
- Many more…
Whether delivering projects in traditional Design-Bid-Build, Construction Management, CM at Risk, or Design Build, contractors are engaging in qualified R&D activities and eligible for tax credits.
179D Commercial Building Tax Deduction
179D Energy Efficient Commercial Building Tax Deduction may be the most powerful incentive for contractors and subcontractors. 179D is a federal tax deduction available to contractors of all types who work on new and renovated government owned commercial buildings. See more here.
- General Contractors
- Mechanical & Electrical Subcontractors
- Energy Services/Controls Companies
- Commercial Window System Contractors
- Commercial Roofing Contractors
- Specialty Building Envelope Contractors
Contractors are eligible for up to $1.80 per square foot for work on K-12 schools, city/county buildings, libraries, airports, state-owned university, public healthcare, GSA, military and all other local, state, or federal public commercial buildings.
Fuel Excise Tax Recovery
The federal government and most state legislatures have enacted tax breaks for various uses of gasoline, diesel, natural gas, and other common fuels. Contractors may be eligible for refunds of tax paid on gallons of certain fuels used in vehicles and equipment on and off-road. See more here.
- Transportation Vehicles
- Compressors & Generators
- Fracturing pump units
- Vehicles with diesel particulate filters
- Diesel engine power units
- Cranes and hoists
These refunds can be significant for companies that consume large quantities of fuel, especially when both federal and state refunds are available.
There are also Partial Sales Tax exemptions, 199 Domestic Production Deductions, and other incentives available to contractors. Let BRAYN help you put money back in your pocket so your business can continue to build, innovate, create jobs, and most of all stay competitive.
Contact Kevin today for a no-cost, no-obligation Phase 1 assessment to determine if your client or company could be eligible for these incentives.