When mold is found in buildings it often requires the services of professionals to identify and fix the root cause of the mold and to remediate the property back to healthy conditions. These essential services typically come with out of pocket expenses that can range from small expenditures to much larger expenses depending on the size and scope of the mold remediation project.
There is however some good news for property owners faced with a mold situation from he Internal Revenue Service (IRS). The unexpected cost associated with mold remediation was recently ruled by the IRS to be a tax deductible expense rather than capitalized expense. An important exception to this rule would be when the mold remediation work was part of a greater remodeling project that was occurring at the same time. So what is the difference between a tax deduction and a capitalized expense? Mold removal and remediation are considered to be ordinary and necessary business expenses, key requirements to be classified as a tax deduction. Mold remediation does not add value to the property. A tax deduction allows the building owner to take full advantage of deducting the entire expense during the tax year in which the expenses occurred.
A capitalized expense, on the other hand, is spread out over a number of years and thus gives less immediate tax relief to the property owner. Renovations that increase he value of the property are not considered ordinary and necessary business expenses and are thus treated differently under the tax code.
This ruling by the IRS is believed to be based on the fact that immediate mold removal is necessary for the health of occupants and is the only solution to bring the property back to an acceptable condition and protect the investment of the property. Asbestos, for example, is usually not treated under the same tax rules since asbestos can be treated in other manners, such as encapsulation which does not require removal.
“This important tax deduction recognition is an important step by the IRS, but as with any condition that may affect your tax situation be sure to check with a qualified tax professional to answer any questions you may have, ensure you qualify and to properly document the process for your tax records,” reported Michael Himelfarb, CEO of Global Prevention Services.
Global Prevention Services is one such company that has seen a significant increase in business from this favorable ruling by the IRS. The company provides a scientifically designed multi-step process that treats, cleans and prevents future growth on all of the appropriate building materials utilizing safe products that do not present a risk to occupants. The treatments are applied by highly trained specialists who understand the importance of treating the entire affected area. The entire process can be accomplished in a matter of hours or days for a fraction of the cost of other remediation services and the company is the only one backed by an extensive warranty provided by an AM Best A+ rated insurance company.
To learn more about the latest mold remediation and preventive services or to resolve your microbial issues please call 877.NoMold5 or visit
www.NoMold.com.
