Recycling Helps the Environment with Tax Breaks for Companies

by Global Trash Solutions

Not only does recycling help the environment, but recycling companies earn tax breaks through many state and federal programs. When businesses produce waste, it’s their social responsibility to make sure that it is disposed of properly, but recycling is also a great way for businesses to save money. There are many tax and financial incentives for companies that recycle properly and make certain institutional changes to their waste management policies.

Your company’s recycling and waste management gain importance as environmental initiatives actively reward green companies and penalize those that have not modernized their commercial garbage disposal equipment and processes. How can your company realize the financial benefits of recycling?

Incentives for Recycling

The federal government offers tax credit to businesses in the form of tax credits on qualifying recycling and commercial garbage disposal equipment. While these programs do not cover your operation expenses for recycling, there are also many state recycling programs that make recycling financially rewarding for businesses.

Federal Tax Breaks for Recycling and Energy Conservation

  • IRS recycling tax credits: The IRS offers both depreciation credits for recycling, and energy credits for using products such as solar panels and fuel cells. Items that are included on the tax credit list include qualified reuse and recycling property acquired after 2008, and biomass and biofuel related property. Equipment and machinery used in the processing, collection, or distribution of recycling materials may qualify.
  • The Department of Energy: The Department of Energy offers grants to businesses for projects that meet certain energy-saving requirements or want to invent new ways of saving energy. Additionally, the DEP offers grants to states for waste disposal programs; many states then allocate those funds to businesses that meet certain waste management and recycle rate

State Tax Incentives for Recycling and Responsible Waste Management

  • State Credits on Business Income Tax. Virginia and other states are offering credits to corporations that buy equipment used for recycling, which can be up to 40% of their tax liability for the year. Unused amounts can be applied to later tax years. Other states with income tax credits for recycling equipment purchases include New Mexico, Idaho, and Arizona.
  • State Property Tax Exemptions. Many states offer property tax exemptions for recycling equipment and machinery, which can provide a cost savings for companies that recycle plastic, wood, cardboard, or other materials. States with these programs include Nevada, Iowa, North Carolina, and Louisiana.
  • State Exemptions on Sales Tax. Depending on the type of business you operate, you might also enjoy sales tax exemptions on equipment purchases. Requirements vary by state but, in North Carolina for example, eligible companies must manufacture recycled products or operate major recycling facilities and must create a minimum of 250 full-time jobs. Iowa and New Jersey offer similar programs to businesses focused on recycling.

Other Benefits of Recycling for your Business

Not all the increased profit from recycling comes from government rebates and credits. When consumers know a business recycles and disposes of their waste in an eco-friendly manner, it improves their opinion of that business. Most consumers report that they prefer to do business with eco-friendly companies.

Your customers appreciate the importance of commercial recycling and waste reduction, and these essential benefits of recycling:

  • Recycling paper saves trees and conserves natural resources.
  • Reusing or recycling glass bottles saves energy and raw materials.
  • Recycling aluminum cans saves energy and reduces the amount of mining for bauxite.
  • Composting organic waste helps reduce greenhouse gases and carbon dioxide emissions from landfills.
  • Recycling improves economic security and creates new jobs and manufacturing opportunities without depleting existing natural resources.

escalator with a pile of plastic bottles at the factory for processing and recycling

How Can Recycling Improve Your Bottom Line?

If your business is operating aging waste management equipment and using employee time to sort and bundle recyclable materials, you can save money by analyzing your waste stream and installing the modern equipment and processes that make the most financial sense for your business. Working with a national waste broker and waste management consulting firm like Global Trash Solutions (GTS) will provide the industry network and expertise you need to invest in better waste management for a healthier bottom line.

Recycling saves money by reducing contamination rates, reclaiming the value of recycled materials, and providing tax credits or incentives for businesses. The national waste management brokers and consultants at GTS can help you conduct a waste audit and negotiate the best rates on recycling and waste hauling services. When you are ready to upgrade equipment, we have commercial and industrial grade waste management and recycling equipment for any size business.

Contact us today for a free consultation at 866-760-8194.

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