R&D
Reasearch and Development Tax Credits
R & D Tax Credits
This is a valuable incentive that encourages innovation and investment in research and development activities by reducing federal income tax liabilities for eligible businesses.
It plays a vital role in fostering technological advancement and economic growth in the United States
Why haven't I heard about R&D Tax Credits?
You’re not alone, even though the credit has been around since 1981, it was typically reserved only for large corporations.
It wasn’t until 2016 that the credit benefits were expanded, and reporting requirements burden reduced, opening the door for millions of additional companies that didn’t have access before.
This will take you to the ERC Fastrack site
Just Selcet R&D from the Drop Down Menu
Benefits of the R&D Tax Credit
-
The R&D credit is now available for businesses of all sizes, including startups.
-
A Hidden and Immediate Source of Cash for Many Companies.
-
Increase the Market Value, Earnings Power And Cash Flow of the Business.
-
Create a Significant Reduction to Current and Future Years Tax Liabilities.
-
Lower your Company’s Effective Tax Rate.
Four part Test for Eligibility
1
Business Component
Development or improvement of a business component for sale or use by a customer
-
Product
-
Process
-
Software
-
Technique
-
Formula
-
Invention
2
Technical Uncertainty
At the onset of the development activity, there must be uncertainty relative to:
-
Capability; or
-
Process; or
-
Appropriate Design
3
Process of Experimentation
Evaluation of one or more alternatives used to eliminate technical uncertainties identified at the beginning of the development activity.
4
Scientific Principles
Principles of physical, biological sciences, engineering, physics or computer science must be inherent in the Process of Experimentation
Two ways to calculate the Credit
Lesser of (QREs – FB) or (QREs x 50% x 20% = Regular R&D Tax Credit
Qualified Research Expenditures (QREs) = Wages + Supplies + (Contract Research x 65%) Fixed Base Amount (FB) = Average Revenue (prior 4 years) x Fixed Base Percentage (FB%)
Regular Research Tax Credit
Alternate Simplified Method (ASC)
QREs – F3YQRE x 14% = Alternate Simplified Credit
Qualified Research Expenditures (QREs) = Wages + Supplies + (Contract Research x 65%) P3YQRE = Prior 3 years QREs
Industries most likely to benefit from the R&D Credit
Why use Origins Group?
1
In - Depth Industry
Knowledge :
Our team of licensed CPAs has extensive experience in navigating the complex world of R&D tax credits. With a deep understanding of the regulations, requirements, and industry-specific nuances, we ensure your R&D tax credit claims are accurate, compliant, and optimized for maximum benefits.
2
Customized Strategies for Your Unique Needs :
We recognize that every business has its unique R&D activities. Our team takes the time to understand your business and tailor an R&D tax credit strategy that aligns with you. Our personalized approach ensures you receive the maximum credit for your qualifying research activities.
3
Comprehensive Documentation & Support :
Our expert CPAs will help you maintain accurate and detailed documentation of your R&D activities, ensuring that your claims are substantiated and audit-proof. We'll guide you through every step of the process, providing ongoing
support and advice to make your R&D tax credit journey seamless and stress-free.
4
Maximized
Savings & Long-Term Growth:
By partnering with our experienced R&D tax credit firm, you can trust that we will uncover every opportunity to maximize your tax savings. These additional funds can be reinvested into your business, fostering innovation, growth, and long-term success.
This will take you to the ERC Fastrack site
Just Selcet R&D from the Drop Down Menu
2
You complete an initial eligibility / discovery questionnaire click
‘See If you Qualify for R&D Credits’
This will take you to the ERC Fastrack site
Just Select R&D from the Drop Down Menu
3
The CPA firm will work with you to clarify your eligibilty
Cost structure and the full process will be confirmed on the initial free discovery call
We arrange a call for you with a qualified CPA firm specializing in R&D Credits
Next steps / What Now ?
Click on the "See If You Qualify" button below or reach out to RPC Advisors for any initial process discussion - Calendar Links are below
1
Our Process . . .
