CARES Act and tax incentives

The CARES Act recently made major modifications to the Tax Cuts and Jobs Act (TCJA) providing organizations with lucrative tax incentives.  Since several business tax restrictions have now been loosened by the CARES Act, there are numerous positive tax consequences that may come from a sale/leaseback of property that providers currently own.

The key modifications the CARES Act made to the TCJA include:

  • Upon the execution of a valid sale/leaseback, you may be able to fully deduct rent expenses on your tax return.
  • You may now claim a tax refund for prior tax years, up to 5-years, if your organization incurred a Net Operating Loss (NOL) in 2018, 2019 or 2020 tax years. 
  • The NOL limitation of 80% of taxable income and carryback restriction has been repealed.

Since these measure are temporary, it is important for providers to TAKE ACTION NOW to benefit from these CARES Act changes before the end of the year. Through these tax incentives, you may be able to funnel more cash into your organization in ways that were not possible before.  We advise you to reach out to your CapGrow Partners representative to learn more about how we can help with your sale/leaseback opportunity.