With New OSHA Regulations Taking Effect, Be Compliant While Saving Money With 2018 Q4 Tax Benefits
When SafeRack was founded in 2003, we knew that manufacturing companies around the world needed top-notch safety equipment to keep their businesses running safely and successfully. Who knew that our efforts could also help the very same businesses earn significant tax benefits in the process? A change in this year’s IRS tax code can dramatically lower the overall cost of capital expenditures made in 2018 for your business. Additionally, new OSHA rules go into effect later this month, which means there’s never been a better time to invest in high-quality safety equipment for your facility.
Section 179 of the Tax Cuts and Jobs Act was enacted in 2018 and made significant changes in the way that companies may write off capital expenditures. In the past, it was necessary to depreciate the cost of an asset over a number of years. With the recent change, businesses can now write off the entire cost of the capital expenditure in the year that the purchase was made.
For example, if you buy qualifying equipment in the amount of $1 million in 2018 and your tax bracket is 35%, come April 2019 you may be able to deduct $350,000 from your tax bill. The net cost of the equipment with the tax deduction applied would then be $650,000. The new law also increased the maximum deduction from $500,000 to $1 million. There are also exclusions such as property the company is buying from itself or one of its subsidiaries and property that is used for electrical energy, water, or sewage disposal.
Most industrial equipment, including safety equipment such as loading platforms, spill containment, gangways, safety cages, ladders, eye wash stations, and fall protection qualifies under the new law, although you should always check with your accountant before making a major purchase.
It’s important to note that the ability to deduct 100% of your capital expenditures in the first year is not indefinite. The new law has an expiration date of December 31, 2022. For more information about how these changes could make an investment in safety equipment possible for your business, check out this article on the subject from the IRS.
While you’re at it, be sure to familiarize yourself with OSHA’s new slip and fall standards. These changes could make now the perfect time to invest in safety upgrades as well. The updates to the General Industry Walking-Working Surfaces and Fall Protection Standards allows more flexibility in the type of fall protection systems you choose.
Several rules go into effect on November 19, 2018. These include requirements to:
- Install fall arrest or ladder safety systems on newly fixed ladders over 24 feet and on replacement ladders/ladder sections, including fixed ladders on outdoor advertising structures.
- Ensuring existing fixed ladders over 24 feet, including those on outdoor advertising structures, are equipped with a cage, well, personal fall arrest system, or ladder safety system.
Clearly, Q4 2018 is the ideal time to invest in safety equipment, and SafeRack is ready to make it easy. SafeRack is the leader in world-class safety equipment including fixed and mobile ladders and platforms, railcar, marine, and truck loading platforms, spill containment, gangways, loading ramps and much more.
SafeRack cannot provide tax advice. Please consult your tax professional.
SafeRack with your OSHA compliance and to take advantage of tax incentives. Call 866-761-7225
By Tony Dublino
Tony joined the SafeRack team in 2018, but he has been helping clients solve logistical and industrial challenges since 2000. His goal is to come up with the solution that maximizes the customer’s ROI and satisfaction. Tony is the Regional Area Manager for New Jersey and the Greater New York City area.