Businesses have just over a month to file their annual taxes and secure returns under new and updated provisions brought forward by the Inflation Reduction Act and the Employee Retention Credit programs.
These programs are offering a variety of taxes credits intended to alleviate some of the pressure companies are still facing from the pandemic, elevated inflation and a tight labor market.
The Inflation Reduction Act, the government-funding legislation passed in August, was enacted to help reduce costs for small businesses by incentivizing energy-saving investments such as electric vehicles and solar energy.
"In my opinion, the credits with one of the biggest returns for businesses, especially car dealerships, are the clean energy credits," said BDO tax director Margaret Reach. "The Inflation Reduction Act provides $43 billion in tax credits aimed at lowering emissions by making those clean energy investments more affordable."
The electric vehicle credit provides $7,500 for qualifying electric vehicles weighing less than 14,000 pounds, and up to $40,000 for vehicles that weigh more.
A tax credit of $30,000 to $100,000 is also available for the buildout of electric vehicle charging stations, with the credit to be calculated based on a single unit rather than per location.
Reach said all the clean energy credits outlined under the Inflation Reduction Act will be available for businesses for the next 10 years, or until 2032.
The Employee Retention Credit is a refundable tax...
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