HVAC Breaking News

Jan. 31, 2005: Contractors Are Eligible For New Tax Incentive

WASHINGTON - The Internal Revenue Service (IRS) has announced that construction and renovation contractors, including HVACR and plumbing contractors, are eligible this year for a new 3 percent domestic production tax incentive on qualifying projects. The tax incentive increases to 6 percent in 2006, and 9 percent in 2010.

"Any tax cut is always a good thing for any business," said Plumbing-Heating-Cooling Contractors-National Association (PHCC) member Mark Giebelhaus of Marlin Mechanical, Phoenix, Ariz. "Considering the thin margins that most contractors work with, a 3 to 6 percent reduction in taxes can be a significant benefit to growing our businesses."

In the construction field, the deduction provides a tax savings on profits on construction or substantial renovation of real property, including residential and commercial buildings and infrastructure. The IRS guidelines describe that substantial renovation is based on whether such "...activities result in permanent improvements or betterments of property, such that the cost of the activities must be capitalized...and must materially increase the value of the property, substantially prolong the useful life of the property, or adapt the property to a new or different use."

"This means that plumbing and HVACR contractors who are aware of this new tax incentive can look forward to significant tax savings on eligible construction and renovation jobs," said Lake Coulson, PHCC's vice president of government relations. "We encourage everyone to consult with their accountants soon to begin considering what projects may qualify in 2005."

Information on the new tax incentive was included in recently issued guidelines from the Internal Revenue Service. The new guidelines incorporate the provisions of the American Jobs Creation Act, which was enacted late last year. The IRS Notice that includes the interim guidelines will be published in Internal Revenue Bulletin 2005-7, dated Feb. 14, 2005.

For more information, visit www.irs.gov.

Publication date: 01/31/2005

Did you enjoy this article? Click here to subscribe to The NEWS Magazine

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

2014 World Energy Engineering Congress

Scenes from the 2014 World Energy Engineering Congress in Washington, D.C.

Podcasts

NEWSMakers: Greenheck Mixed Flow Fan, Model EQB

Shane Dock, Application Engineer at Greenheck, will introduce you to Greenheck’s new EQB mixed flow fan. We’ll discuss what the features of the EQB’s innovative design, what kinds of applications can utilize the EQB, and why the EQB is an attractive inline choice for your customers’ projects.  Dock is currently focused on applications regarding inline fans, gravity ventilators, and electrical products. Posted March 4th.

Sponsor:



 

More Podcasts

ACHRNEWS

NEWS 03-02-15 cover

2015 March 2

Check out the weekly edition of The NEWS today!

Table Of Contents Subscribe

HVAC Trends

The NEWS regularly reports on HVAC industry trends in our weekly issues. What trends do you see?
View Results Poll Archive

HVACR INDUSTRY STORE

2015.jpg
2015 National Plumbing & HVAC Estimator

Every plumbing and HVAC estimator can use the cost estimates in this practical manual!

More Products

Clear Seas Research

 

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications, Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.

DON'T MISS A THING

Magazine image
 
Register today for complete access to ACHRNews.com. Get full access to the latest features, Extra Edition, and more.

STAY CONNECTED

facebook icontwitter iconyoutube iconLinkedIn i con