R&D Tax Credit
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Table of Contents
- What Is The R&D Tax Credit
- What Qualifies for the R&D Tax Credit?
- Does My Industry Qualify
- Do Start-Ups Qualify?
- Does My State Have a R&D Tax Credit Program?
- Can you apply tax credits to reduce a portion of your federal payroll taxes?
- How Do You Know If Your Activities Qualify For The Credit?
- When Is The Best Time To Have An R&D Tax Credit Study Done?
- How Far Back Can You Claim Your R&D Tax Credit?
- How We Help You Get Your Tax Savings
- Case Studies
What Is The R&D Tax Credit?
The R&D tax credit is an incentive to stimulate innovation and technical design. It provides companies with significant incentives for developing new products, processes, or inventions, which they can use as reimbursement for qualified research activities completed within the United States; this means that American businesses will always be at the forefront of cutting-edge technology!
What Qualifies for the Tax Credit?
- Software Development
- Payroll Expenses Related to R&D Activities
- New Manufacturing Processes
- New Product Innovation
- and more
Activities that would otherwise be considered “day-to-day operations,” such as designing new products or analyzing market trends, are eligible under this credit!
To determine if you qualify for the research and development credits under the IRS, you will need to find out if your activities meet the four-part test.
Does My Industry Qualify?
Answer: Companies of all sizes and industries can qualify for this tax credit.
Qualifying Activity Examples: Learn about the specific qualifying activities in your industry by clicking the links below:
Do Start-Ups Qualify?
R&D credits can be ideal for startups—particularly those of a technical nature, such as in the fields of computer science or pharmaceuticals. The credits can deliver a financial windfall to qualifying taxpayers, but the unique circumstances of startups entail challenges. As a result, it’s wise to engage a seasoned tax and engineering specialty firm.
Does My State Have A Research and Development Tax Credit Program?
Learn more about which states have an R&D tax credit program with our the map below. Click your state to gather initial details on your state's available credits. Each state has a link to its .gov website for the tax credit program itself or the tax credits and incentives page. Keep in mind, these R&D state credits are in-addition to the federal tax credit, which you may qualify for both.
Can you apply tax credits to reduce a portion of your federal payroll taxes?
When Is The Best Time To Have A Study Done?
If possible, have your study completed well in advance of your April 15 or October 15 tax filing deadline.
But what happens when tax deadlines have come and gone, and your business failed to claim the tax credit? No worries – you can still file your claim for the credit with an amended return.
How Far Back Can You Claim Your R&D Tax Credit?
You can capture your credit for the current tax year and for the prior three open tax years.
If you have performed qualifying activities in the past, this could be a substantial credit for your business. You can also submit tax credits for project that didn’t succeed—not just the ones that worked out.
How We Help You Get Your Tax Savings
What to expect when working with Engineered Tax Services.
See If You Qualify
We will help you gather all your documentation. This includes receipts, invoices, contracts, and other records of qualified activities.
Prepare Your Forms
If you are eligible for the tax credit, we'll help you file all the necessary forms to recieve the tax credit.
Claim Your Tax Credit
Finally, we'll help you file your claim so you can get the money you are entitled to.
Getting an R&D Credit Analysis to see if you qualify is the first step!
R&D Case Study: Engineering Firm in New York
eBook: The Architect's Guide to R&D Tax Credits
This comprehensive e-book is designed to help you recognize which of your activities qualify for R&D tax credits!
Whitepaper: R&D Tax Credits
How can R&D tax credits propel your business to the next level of success? This comprehensive white paper explains how your company can be rewarded for innovation via a substantial tax break, but one that less than one-third of companies entitled to the credit know they’re eligible. With special chapters on R&D tax credits for startups and for software and gaming. Download a Free Copy today!
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Testimonials: Our valued clients
Case Studies: R&D Tax Credit
R&D Tax Credit Case Study for Specialty Manufacturer in Oregon
1 Year Tax Savings: $18,078 (Federal Only) Study Highlights Wages $525,358 Supplies $26,953 Rental or lease of computers 27.5-Year Contract Research $11,760 Total Qualified …
R&D Tax Credit Case Study For Specialty Manufacturer in New York
1 Year Tax Savings: $18,078 (Federal Only) Study Highlights Wages $358,407 Supplies $26,953 Rental or lease of computers 27.5-Year Contract Research $14,227 Total Qualified Research …
R&D Tax Credit Case Study for Software Developer in Texas
1 Year Tax Savings: $72,430 (Federal Only) Study Highlights Wages $1,342,919 Supplies $0 Rental or lease of computers $0 Contract Research $0 Total Qualified Research …
Articles: R&D Tax Credit
The Power of R&D Tax Credits for Manufacturing Businesses
It’s no secret that manufacturing companies face a host of tax concerns, but there is a solution. Many business owners are unaware that they are …
The Case of Cajun Industries: 3 Questions to Consider Before Claiming R&D Tax Credits
A recent lawsuit filed in the U.S. District Court for the Middle District of Louisiana highlights three important questions that every taxpayer should consider before …
What R&D Changes to Amortization vs. Expensing Mean for You
In 2017 the Tax Cuts and Jobs Act (TCJA) included significant tax breaks for taxpayers but often when a bill like this is passed, the …