Nursing homes that need to update their sprinkler systems would benefit from a recently introduced tax bill.
Under the “Fire Sprinkler Incentive Act Update 2013,” long-term care facilities would be able to fully deduct the cost of a sprinkler system retrofit up to $125,000. This would cover 100% of costs for facilities of up to 50,000 square feet, assuming a retrofit cost of $2.50 per square foot, advocacy organization Common Voices pointed out.
Facilities that are seven stories or higher would have another tax incentive if the bill passes. The law would change the depreciation schedule for sprinkler systems from 39 years to 15 years for these structures.
Federal regulations passed in 2008 called for nursing homes to install a fully automatic sprinkler system by Aug. 13, 2013. The Centers for Medicare & Medicaid Services has proposed extending the deadline in certain circumstances.* Retrofits that have already been completed would not qualify for the proposed tax breaks in the Incentive Act.
The bill was introduced on June 13 by Sens. Tom Carper (D-DE) and Susan Collins (R-ME). Previous versions of the bill were supported by the American Health Care Association.
*Editor’s Note: The article originally stated that CMS extended this deadline. The extension was proposed in a rule published in the Federal Register, but the rule has not been finalized.