Small changes to your payroll rules can multiply your 179D tax deduction by five.
We break down how a 45,000 square foot project saw its deduction climb from $50,850 to over $250,000 simply by utilizing prevailing wage and registered apprentices. If you own commercial real estate, you cannot fix these labor classifications after the contract is signed.
Know the rules before you break ground.
Full episode: taxstrategyplaybook.com
Free analysis: calendly.com/david-wiener/cs or 770-224-8504, option two
A 45,000 square foot medical office replaced its lighting and entire HVAC in 2024. $600,000 of work, private contractor, no prevailing wage and no registered apprentices.
At base rates that is $1.13 a square foot. 45,000 x $1.13 = $50,850.
Run that identical job with prevailing wages and registered apprentices and the whole scale multiplies by roughly five. About $5.65 a foot, and the deduction lands a bit over $250,000.
Same building. Same equipment. Same money spent. The only variable was how the contractor ran payroll.
You cannot fix this afterward. Know the labor rules before you sign the contract.
From The Tax Strategy Playbook, episode 30: 179D after the deadline.
Full episode at taxstrategyplaybook.com
Free analysis on any building you own, no obligation:
calendly.com/david-wiener/cs or 770-224-8504, option two
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