Tax Advantages of Metal Building Systems: Save Money While Adding Value

When it comes to building your next commercial property, one of the most important considerations is long-term financial planning. While there are many factors to consider, one that stands out is how the type of construction you choose can impact your taxes. Metal building systems, particularly those offered by Paramount Metal Systems in Little Rock, AR, can provide significant tax advantages that help you save money while adding lasting value to your investment. In this article, we will explore the key tax benefits of choosing metal building systems and how they can provide an outstanding return on investment (ROI).

Why Choose Metal Building Systems?

Before we dive into the tax advantages, it’s important to understand why metal buildings are becoming an increasingly popular choice for business owners. Metal buildings offer a range of benefits, including:

• Durability and Longevity: Metal buildings are known for their long lifespan, requiring less maintenance over time compared to traditional wood-frame structures.
• Energy Efficiency: Metal buildings are highly energy-efficient when paired with modern insulation, reducing heating and cooling costs.
• Faster Construction: Metal buildings can be constructed much faster than traditional buildings, reducing labor costs and downtime for businesses.

These features, combined with tax advantages, make metal buildings a smart choice for businesses looking to optimize both their construction and operational costs.

Tax Benefits of Metal Building Systems

1. Depreciation for Metal Buildings

One of the most significant tax advantages of metal building systems is the ability to depreciate the cost of the structure over time. Depreciation is the process of spreading out the expense of a long-term asset, such as a building, over its useful life. The IRS allows businesses to depreciate commercial property using the Modified Accelerated Cost Recovery System (MACRS), which provides substantial tax savings.

How It Works:
For metal building systems, the IRS typically allows a 39-year depreciation period for commercial structures. However, due to their simplicity and construction materials, metal buildings may qualify for accelerated depreciation under MACRS. This means you could recover a significant portion of your investment in the first few years.

For example, businesses that construct or buy a metal building could be eligible to write off a portion of the building’s cost each year, lowering taxable income and reducing the amount of tax owed.

Source: IRS Publication 946, How to Depreciate Property (https://www.irs.gov/publications/p946)

2. Section 179 Deduction for Metal Buildings

Section 179 of the IRS Tax Code is another important benefit for businesses investing in metal buildings. This provision allows businesses to deduct the entire cost of qualifying property, including certain metal building systems, in the year the property is placed into service. In some cases, businesses can deduct up to $1,160,000 of qualifying purchases in 2024 (subject to phase-out limits).

How It Works:
Under Section 179, the cost of a metal building can be fully deducted in the year it’s put into use, as long as it meets certain requirements. These requirements include the building being used for business purposes, with the intention of long-term use. This deduction can significantly reduce the upfront financial burden, freeing up cash flow that can be reinvested in your business.

Source: IRS Section 179 Deduction (https://www.section179.org)

3. Bonus Depreciation for Metal Buildings

Bonus depreciation is another tax advantage available to businesses that purchase metal buildings. The Tax Cuts and Jobs Act (TCJA) introduced bonus depreciation, allowing businesses to deduct 100% of the cost of qualifying property in the first year of service. This provision is particularly valuable for metal buildings because it accelerates depreciation for large capital investments.

How It Works:
Bonus depreciation allows businesses to write off the full cost of a new metal building in the first year, reducing taxable income by a significant amount. While this provision is set to begin phasing down in the coming years (with a scheduled reduction to 80% in 2023, 60% in 2024, and so on), it still provides substantial tax savings for businesses that act quickly.

Source: Tax Cuts and Jobs Act Overview (https://www.congress.gov/bill/115th-congress/house-bill/1/text)

4. Energy-Efficient Building Tax Incentives

In addition to standard depreciation and deductions, metal buildings that meet energy-efficient standards may qualify for additional tax incentives. The federal government, along with some state and local programs, offers tax credits and rebates for buildings that utilize energy-saving features such as high-performance insulation, solar panels, and reflective coatings.

How It Works:
Certain energy-efficient metal buildings may qualify for tax credits under Section 45L of the Internal Revenue Code, which offers a tax credit of $2,000 per unit for homes and commercial properties that meet specific energy-efficiency criteria. Additionally, state-level programs like Arkansas’ energy efficiency incentives may provide businesses with further opportunities for tax savings.

Source: U.S. Department of Energy, Tax Incentives for Energy Efficiency (https://www.energy.gov/energysaver/financing-and-incentives)

5. State-Level Tax Benefits in Arkansas

In Arkansas, businesses investing in metal buildings can also benefit from local tax incentives and programs designed to encourage commercial development. These incentives may include:

• Sales and Use Tax Exemptions: Arkansas offers certain sales and use tax exemptions for equipment and building materials used in the construction of new facilities.
• Tax Credits for Job Creation: Businesses that invest in new construction and create jobs may be eligible for tax credits or rebates through the Arkansas Economic Development Commission (AEDC).

These state-level incentives, combined with the federal tax advantages, make investing in a metal building system a highly attractive option for businesses in Little Rock and beyond.

Source: Arkansas Economic Development Commission (https://www.arkansasedc.com)

Maximizing Your Tax Savings with Paramount Metal Systems

When working with Paramount Metal Systems in Little Rock, AR, you can take full advantage of these tax benefits while constructing a durable, energy-efficient building. Paramount Metal Systems specializes in high-quality metal building systems designed to meet the specific needs of your business, offering a perfect combination of long-term value and immediate tax savings.

Our team is here to guide you through the process of planning your metal building system, helping you understand the full range of tax advantages available to you. Whether you're looking to reduce your tax burden through depreciation, qualify for energy-efficient tax credits, or explore Arkansas-specific incentives, we provide the expertise you need to maximize your savings.

Invest in Your Future with Metal Buildings

Choosing a metal building system for your commercial property offers a wide range of tax advantages that can help you save money, enhance your bottom line, and increase the overall value of your business. From accelerated depreciation to Section 179 deductions and state-level incentives, metal buildings provide a powerful way to reduce your taxable income while adding long-lasting value.

If you're ready to take advantage of these tax savings and start your next project, contact Paramount Metal Systems in Little Rock, AR. Our team will help you navigate the complexities of tax incentives, ensuring you get the maximum return on your investment.

Ready to save on taxes while investing in a high-quality metal building? Contact Paramount Metal Systems today to discuss your options and start building your future.