The Research & Development (R&D) tax credit is one of the most significant domestic tax credits remaining under current tax law – a substantial tool for maximizing a company’s cash flow and bottom line.
No one can afford to leave money on the table. Nevertheless, when it comes to the R&D credit, cash is left untouched all the time. Despite the fact that the R&D credit has been available since 1981, less than a third of eligible companies recognize that they qualify for the credit. Even if companies claim an R&D credit, they frequently do not claim the entire credit to which they are entitled, either because they do not understand what qualifies or do not have the processes in place to properly document the credit.
Without competing for your accounting work, we can help you and your clients identify and capture the R&D credit and increase cash flow for all involved. Credits for qualified activities are available in addition to deductions. The credit is a dollar-for-dollar cash offset against your taxes and can be significant if properly pursued.
You don’t have to be a manufacturer to claim the R&D credit Companies of all sizes in a wide range of industries throughout the United States have used the R&D tax credit.
According to a report released by the R&D Credit Coalition, an advocacy group:
- 17,700 public and private companies claimed research tax credits for a total of $6.6 billion in tax breaks
- Firms in all major industries claim the R&D credit; principal industries include manufacturing, professional, scientific and technical services and information sectors
- States with the most companies reporting R&D activity include Florida, California, Texas, Massachusetts, Pennsylvania, New York and Michigan
What qualifies for the R&D credit?
Many activities can qualify for the R&D tax credit, including:
- Developing or formulating new or improved products
- Functionally enhancing existing products or formulas
- Developing new or improved production processes
- Assisting customers with technical problem-solving
- Developing new or improved software for use or sale
- Applying for patents and prototyping
Our R&D studies dig deep for better credits
We perform a study that digs much deeper into the fundamentals of your business activities – incorporating operations, engineering, financial and tax expertise that results in more credits and meticulous documentation that is necessary to support your activities, costs and credit. There is a direct correlation between the amount of your defensible credit and the expertise of the advisor performing the tax credit study.
Complimentary no-risk assessment
We perform an assessment first to help determine prior years’ credits and project the current year opportunity. Your team’s time commitment is typically less than 12 hours for the assessment. No individual team member should have to spend more than an hour total during the process.
Expertise that makes you a hero
We have a dedicated team committed to preserving your rights to claim federal and state R&D credits. These professionals focus solely on R&D credit issues and have significant audit defense experience (unlimited audit defense is included in our project agreement). We have assisted in recovering in excess of $100 million in cash refunds from previously unclaimed credits and in developing proprietary methodology for defending past, present and future credits. We want to work WITH you to help you and your clients benefit from this substantial tax credit. Partnering with us will ensure that your clients will have access to the most experienced, most successful R&D team. You become a hero to your partners or clients when they discover the cash that would otherwise be left on the table.
To register for a complimentary R&D webinar, click here.
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