Save money and reduce your tax liability for work that you are already doing.
State and Federal Research and Development (R&D) Tax Credits are available to companies that have qualified expenses incurred for research and development. It can provide permanent benefits in driving down your effective tax rates and generating cash flow, and can also be claimed in addition to any tax deduction taken for R&D expenses.
If your company currently does not have any tax liability, you can still claim the credit on the research done today and claim the R&D credit prospectively in a year when taxes are owed. If your company is already well-established, depending on when your tax return was filed, you may be eligible to claim research credits for three prior open tax years.
Many companies think that you need to have an engineer on staff to qualify; however, these incentives apply to a broad range of companies. Various activities apply including production, quality assurance, sales, marketing, purchasing and information technology. Your company is eligible for the R&D tax credits if it is in the process of developing new, improving on, or making more reliable products, processes and formulas. This includes such activities as:
Contact: Lynn Boster, CPA, CGMA