Restaurant Owners – Are You Taking Advantage of Cost Segregation?

Woman setting a table

Restaurant owners who are building or remodeling their property can reduce their federal tax liabilities through a cross segregation study. Restaurant owners can benefit from Cost Segregation studies by increasing their cash flow and lowering federal tax burdens.

Cost segregation studies are a strategic tax planning tool that is completed to maximize federal income tax depreciation deductions by identifying fixed assets and their costs. It allows for restaurant owners to take their property and have it be categorized into acquisition or construction costs and then applied to the appropriate IRS tax credit. Through a cost segregation study, properties can be reclassified from a standard 39-year depreciable life to a 5, 7, or 15-year depreciable life, which enhances federal tax credit savings, and improves cash flow.

Does My Restaurant Qualify? 

Almost any property from any company or industry can benefit from a cost segregation study, but restaurants are ideal property candidates. National Tax Group has performed cost segregation studies for a variety of enterprises over the last 20 years and has saved our restaurant owners millions in tax incentives. 

Qualifying items that can be reallocated include:

  • Carpeting, vinyl, and epoxy flooring
  • Canopies and awnings
  • Kitchen equipment gas systems
  • Sound systems
  • Equipment related electrical and plumbing connections
  • Decorative light fixtures
  • Kitchen storage and preparation equipment

Cost Segregation is often most lucrative on properties that have spent over $1 Million on the property and its improvements. 

Why Should I Invest in a Cost Segregation Study?

By taking advantage of the benefits a Cost Segregation Study can provide your business, the acceleration of depreciation can give massive tax benefits years sooner than expected. This allows restaurant owners to capitalize on their value and start the new decade by increasing their cash-flow. 

Give us a call today! Our team of Cost Segregation experts will give you a free assessment today to see if your properties qualify! With little work on your part, you could start 2020 off with more money to invest back into your business. 

179D Extended Through 2020

Pen and house blue prints

Retroactively Claim 3 Years’ Worth of Deductions

One of the best things that happened at the close of 2019 was the long-awaited extension of the 179D! This Energy Policy was cultivated in 2005 to allow a tax deduction of up to $1.80 per square foot for both new and existing buildings. This policy was recently extended through 2020, which means commercial building owners and architects who qualify have the opportunity to go back and save for 2018 & 2019!

What does this mean for my business? 

This is excellent news for commercial building owners and architects because this extended tax deduction is for newly constructed or renovated buildings that have installed energy-saving elements. Your business can take advantage of these tax deductions for your 2020 projects, as well as retroactively go back and add these deductions to your 2018 and 2019 taxes. This can mean you earn up to 2 years’ worth of deductions to start 2020 off on a lucrative note. 

What qualifies for the 179D tax deduction?

This tax incitative applies to any newly constructed or renovated buildings that have installed energy-saving elements. A few qualifying features include but are not limited to: hot water systems, building envelope systems, HVAC, interior lighting systems, insulation throughout the building, lighting sensor and controls. If your project includes any energy-efficient elements in those categories, it most likely qualifies for the maximum deduction possible. 

How do I take advantage of the credit? 

Give us a call today! Our team of 179D Tax Deduction experts will give you a free assessment today to see if your properties qualify! With little work on your part, you could start 2020 off with every tax deduction you missed in 2018, as well as take advantage of it for your 2019 taxes! So contact us today because we are ready to help you maximize up to 3 years’ worth of deductions!

45L Extended Through 2020

Increase Your Cash Flow Today for Past and Future Projects

Contractors everywhere are starting the new year on a lucrative foot, thanks to the extension of the 45L bill. 45L is a tax credit available to contractor’s projects for installing energy-saving elements to newly constructed single-family homes and low-rise residential buildings that reduce energy and power costs. It was a lucrative tax incentive that expired at the end of 2017, but was recently extended through 2020 and retroactively applies to 2018!

What does this mean for my business? 

This extension will not only allow qualifying professionals to take advantage of this tax credit in their 2020 taxes, but they also have the opportunity to update their 2018 and 2019 taxes now! National Tax Group is a family of in-house experts that will work with you to obtain up to $2,000 in tax credits for each dwelling unit that qualifies for every year you missed during the expiration. 

What properties qualify for the 45L tax credit?

Any residential property three stories or less that is currently undergoing construction, or has recently undergone renovations to meet the efficient energy threshold has the opportunity to claim this credit for each dwelling unit. So if you are working on adding energy-efficient upgrades to a freestanding single-family home, townhome, manufactured home, condominium, or an apartment unit, that project is highly likely to qualify for the 45L tax credit. 

How do I take advantage of the credit? 

Give us a call today! Our team of 45L Tax Credit experts will give you a free assessment today to see if your properties qualify! With little work on your part, you could start 2020 off with the tax credit opportunities you missed in 2018 as well as take advantage of it for your 2019 taxes! So contact us today because we are ready to help you maximize up to 3 years’ worth of credits!

 

Tax Alert: 179D and 45L Extended Through 2020

National Tax Group is excited to announce that the 179D and 45L tax incentive legislation has been extended through 2020!

We have been closely monitoring the status and working with government representatives to lobby for the extension of these expired tax incentives that we specialize in. Legislation has extended these two tax initiatives through December 31, 2020. This is major news in the world of construction & development and means your business can again, take advantage of this most lucrative tax incentive.

This is great news for those that took advantage of these incentives before their expiration in 2017 because your business can now claim for the missing years through 2020! The Bill H.R.1865 (H.R. 1865) was a significant win for real estate and architect professionals that can benefit from these tax codes. If your residential property is currently under construction or has recently undergone renovations in order to meet the energy efficient threshold, you can immediately claim those benefits by updating your taxes for 2018 and 2019. 

179D is a tax incentive that is available for newly constructed or renovated buildings that have installed energy-saving elements. This green tax deduction provides tax-saving benefits for commercial building owners, as well as architectural and design firms that have worked on government projects which can now be claimed back for 2018, 2019 and through 2020. 

So contact us today because we are ready to help you maximize these credits for 2020 as well as claim the credits you would have earned from 2018-2019. 

Hotel Owners Stay Alert

New Tax Laws for Significant Savings

Every hotel owner remembers in 2017 when the Tax Cuts and Jobs Acts brought 100% depreciation into place. However, it was not until recently when they finalized the rules of what qualifies and how every hotel owner can claim these savings. 

What Can Your Hotel Write Off?

While the rules set in place in 2017 were beneficial to hotel owners, the new specifications make it clear that they can write off 100% of depreciable business assets with a recovery period of 20 years or less. This means that your hotel can write off 100% of:

  • Furniture 
  • Appliances
  • Computers
  • Equipment 
  • Machinery

This final version gives some clarification on the requirements these assets must meet to qualify for this deduction. With these updates, it gives hotel owners to save big on standard upkeep expenses.  

It is also important to keep in mind that just because these new rules were released in September 2019, this deduction applies to qualified property purchases that were placed in service after Sept. 27, 2017.

How Does Your Hotel Take Advantage?

Of course, your hotel wants to be able to take advantage of this opportunity to increase your cash-flow with this deduction. National Tax Group is here to walk with you every step of the process to make sure you get every dollar your hotel is eligible for. 

With our expertise and experience in the hotel industry, National Tax Group will do a thorough investigation of your hotel assets to make sure you not only get rewarded for recent purchases but previous purchases as well. Even if you missed filing for this deduction in a previous year, you could still qualify them for this coming tax season. 

A cost segregation study is one of the most profitable investments a hotel owner can make due to the revenue-enhancing opportunities they can uncover. To claim your free assessment, call us at (561) 257-3436 or contact one of our tax experts. 

 

179D & 45L : Green Act 2019 Has High Chance of Passing

Growing Renewable Energy and Efficiency Now (GREEN) Act

National Tax Group has closely been monitoring the Senate situation in regards to the fate of the Green Tax Credits, which is now part of the Green Act of 2019. Through the uncertainty, things are looking good for the bills that have been expired since the end of 2017. Top tax writers from both political parties are growing confident that the presented bill will pass in the next few weeks. 

While the draft is divided into seven sections, the majority of the action falls into three categories: renewable energy production and storage, energy efficiency, and electric vehicles. Some of these provisions renew and otherwise modify extenders themselves; others are pegged to finite quotas that require adjustment, and a few are entirely new incentives meant to spur energy innovation.

Last week the Green Act of 2019 was called to extend the 179D and 45L incentives, alongside several others, from 2017 to 2024. The energy efficiency level to qualify for these tax incentives is also to be lowered from 50% down to 30%. To top it all off, the 179D incentive has been increased from $1.80 per square foot to $3.00 per square foot. The 45L credit will also be granted an upgrade from $2,000 per unit to $2,500 per unit should this green initiative pass on it’s expected passing date of December 20, 2019. 

These Green Tax Deductions will make it possible for businesses and developers to reduce their carbon footprint as well as increase their cash-flow each year. National Tax Group is siding with the tax writers in confidence that this bill will pass. Get your green plans locked and loaded because once this passes, National Tax Group is here to help you claim all of the incentives your business or unit qualifies for. 

Nothing in this draft, except perhaps the inclusion of a biodiesel phase-down, comes as much of a surprise. But the timing, along with the fact that Democrats conspicuously omitted any poison pill pay-fors, is reason enough for optimism as it relates to the tax policy endgame. Congress is poised to approve a stop-gap funding measure this week, giving them until December 20th to procrastinate. In the meantime, the trajectory must change for a tax deal to happen. The Four Corners need something to bring the terms of an agreement into focus, and Democrats speaking with one voice on their ask—in this case regarding clean energy—will be critical. Perhaps an olive branch could be the good-faith catalyst that spurs a needed breakthrough. We’ll know more in the coming days—stay tuned.

179D Update: More on the Horizon for Green Act of 2019, More Money, and Flexibility.

US Capitol Building

After weeks of speculation, the details of the new energy efficiency proposal  have been released. This proposal has been a long time coming, and it is believed to have a prospective pass date of December 20, 2019. Not only does this bill seek to renew multiple green energy efficiency tax codes, but it is also giving 179D and 45L a facelift. 

What is now being called the Green Act of 2019 calls for the 179D and 45L incentives to be extended from 2017 to 2024. They are also requesting that the energy efficiency level to qualify for these tax incentives be lowered from 50% down to 30%, which would give many more businesses and home builders the opportunity to take advantage of these going green activities. Furthermore, it has been requested that the current 179D incentive of $1.80 per square foot be increased to a full $3.00 per square foot, which almost doubles its value and appeal. The 45L credit has also been upgraded from $2,000 per unit to $2,500 per unit. 

This is a good day for those hoping to take advantage of these going green initiatives in their 2020 projects. More information on its passing date should be released soon, but National Tax Group is hopeful of the outcome, and we are excited to see this come to fruition. Get your tax information ready because once this has been resolved, National Tax Group is here to help you claim all of the incentives your business or unit qualifies for. 

179D Update: House Returns From Recess to Continue Negotiations

The House has returned from their one-week recess on Tuesday and has been against the wire on the November 21st expiration looming overhead. Despite the Democratic party submitting their proposal a few weeks ago on how to resolve this bill, the House and Senate have not come to an agreement on the spending levels. At this point in time, spending negotiations are being stalled due to the political unrest caused by President Trump’s continued request for increased funding to build a wall at the border. 

The green tax extenders package was already in a fragile state before the trouble that has stirred in the White House in the last few months. However, Democrats are still pushing for the life of some green initiative tax incentives. Also, on November 13, a group of 66 different trade associations that are representing multiple industries cultivated a letter to House and Senate asking them to make a move on the tax extenders package that was proposed. This letter pushes for the renewal of multiple tax provisions – including the 179D. 

National Tax Group will continue to be monitoring the status and updates of these tax provisions. As experts in these specialized areas of the tax code, we are prepared to help all taxpayers obtain their incentives once they can again. Contact one of our team members to learn about the expired tax provisions and the benefits they will bring you.

 

How the Solar Industry is Using R&D Tax Credits to Offset Innovation Costs

Energy power

Get Rewarded for Investing in Innovation for your Solar Company

The solar industry is thriving more and more with each year that passes. A new energy-efficient system is installed approximately every four minutes in the United States, and it is not projected to slow down with the increased popularity of green initiatives and global warming. The solar industry is at a prime time to invest in research and development efforts for their businesses. 

The Research and Development Tax Credit was created in 1981 to encourage innovation amongst businesses. With this incentive, you can offset the costs of your innovation of up to 13% in eligible spending for new and improved products and processes. The best part about this credit is that most of the qualifications are found in day-to-day activities that your business is already doing. 

Qualifying Innovation Fields Include:

  • Solar & Wind Energy Storage
  • Mobile Power
  • Smart Grid
  • Carbon Sequestration & Biofuel
  • Utilizing BIM (Building Information Modeling)
  • Conducting Request for Information Process (RFI’s)

There are many areas within the renewable energy industry that can be improved upon. Solar technology is seeking panels that are more efficient. Creating new and improved systems that can determine how to efficiently store energy generated from solar panels, converting solar energy from AC to DC, and creating new products that can reduce installation costs for homeowners and commercial building owners.    

Eligible costs that can be used to claim this tax credit are items like employee wages, cost of supplies, cost of testing, contract research expenses, and costs associated with developing a patent. If your solar company is already doing the work, it makes sense to claim back as much as you can and get rewarded for your improvements. 

If your company has taken steps to create a reliable, renewable, and clean alternative for energy consumption, you are likely able to qualify for R&D credits. Give us a call at (561) 257-3436 and let us perform an assessment on your business to see if you qualify. 

179D Update: Democrats Pushing for Energy Efficiency Bill

Things are looking good for the 179D tax incentive. As we have reported here before, this incentive, along with other energy-efficient tax codes, is included in a bill that is being pushed for. The last we heard, the Democratic Party was preparing a green energy tax bill that should guarantee a renewal or extension of specific tax incentives like the 179D.

Recently, the majority of House Democrats showed up strong, with 166 members signing a letter requesting their leadership to get as many “clean energy tax policies” renewed as possible. This letter also encourages a year-end tax deal, so it looks like we can report good news soon! 

Additionally, this incentive has received major outside endorsements as a group of business and energy efficiency advocates wrote to Congress asking them to pass these clean energy tax policies. They are seeking to increase green policies and efficiency in new and existing home developments. House tax writers from both sides are claiming that Congress can find a solution before the end of the year. 

National Tax Group will continue to be monitoring the status and updates of these tax provisions. As experts in these specialized areas of the tax code, we are prepared to help all taxpayers obtain their incentives once they can again. Contact one of our team members to learn about the expired tax provisions and the benefits they will bring you.