Our Services
The Research and Development (R&D) Tax Credit applies to both Federal and state tax jurisdictions as an incentive to encourage businesses of all sizes to invest in technical activities and innovations. The R&D Tax Credit allows businesses to reduce their tax liability in the current year, as well as looking back to the three prior years that remain open under statute. Our process focuses on utilizing the most appropriate method available within applicable codes and regulations for determining qualified expenditures and calculations of the R&D credit. We defend all of our studies before the applicable taxing authorities at no additional cost, when necessary.
Research and Development Claim Process
The initial evaluation is a study to ascertain whether a taxpayer is entitled to the credit and has met by law thefollowing four qualifying requirements:
• Technological in nature or the discovery of new innovations
• Improved functionality, performance or quality of the qualified research activity
• Review the activity which is intended to be used in the development of a new or improved business component
• Process of experimentation which relies on the qualified activities requirement to provide trial and error efforts
The study will involve an in-depth audit, substantiating the qualified research expenses by qualified activity as follows:
• Review of detailed accounting records
• Physical inspection of operations
• Employee interviews
• Project validations and review of detail reports
• Review of available engineering reports
We will then prepare a complete compilation of the study’s findings which would include the following:
• Summary of the taxpayer’s general operation and details on research activities
• Summary of the method adopted in reviewing the research and development claim
• Details and explanations of the various departments involved in the research activity
• Work papers illustrating the computation of the credit, which would include the following activities:
- Wages paid to employees
- Supplies and non capitalized tangible personal property
- Contract research activities
