IRS To Allow Alternative Research Tax Credit Election on Amended Returns

On June 2, 2014, the IRS released temporary regulations amending Sec. 1.41-9(b)(2) allowing taxpayers to utilize the Alternative Simplified Credit Method to compute the research tax credit on an amended return. This removes the restriction of using the Regular Method calculation on an amended return and eliminates the need to perform the often complex and risky base-period percentage calculation associated with the Regular Method calculation. These temporary regulations serve to make it easier and quicker for a taxpayer to calculate the research credit which may have been omitted on the originally-filed return and removes the base-period percentage calculation which is often the cause of disallowed research claims.