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Tax Deductions for Qualified

Improvement Property (QIP)

2020 CARES Act

Coronavirus Aid, Relief, and Economic Security Act

usa.siemens.com/buildingtechnologies

Highlights to Section 168

Qualified interior improvements made by the taxpayer

for existing non-residential buildings may be eligible

for a tax deduction of the full amount of equipment and

labor costs in a single year, without limitation on the

size of the project.

QIP can include:

• HVAC interior ductwork

• Building management systems

• Sensors, valves, actuators, and other HVAC devices

• Interior work for most other building systems including

plumbing, electrical, fire protection and alarm, gas distribution,

and security systems

• Modifications to tenant spaces, as long as the interior

walls are not load-bearing

The CARES Act provides a technical correction

for qualified improvement property (QIP),

enabling taxpayers to claim 100% bonus

depreciation on eligible QIP.

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Tax Deductions for Qualified Improvement Property (QIP) 2020 CARES Act Coronavirus Aid, Relief, and Economic Security Act usa.siemens.com/buildingtechnologies Highlights to Section 168 Qualified interior improvements made by the taxpayer for existing non-residential buildings may be eligible for a tax deduction of the full amount of equipment and labor costs in a single year, without limitation on the size of the project.
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Invest in qualified facilities improvements to optimize building performance and tax savings. How it works: Example for energy savings project • $1M = annual and installation Escalation rate of 3% • $200,000 = annual energy savings Estimated project life of 20 years • $200,000 = annual utility incentives • 3.89 years = simple payback (without using depreciation) • $1.53M = Net Present Value • 3.71 years = simple payback Using straight-line depreciation over 20 years • $1.63M = Net Present Value • 2.