Sandersen Knox and Company, LLP CPA's - Houston Texas area Tax Accountants, Auditors, Consultants to Business and Government. Sugar Land

THE OPPORTUNITY - FOUND MONEY

 

In December of 2003, the Bush administration issued new final IRS regulations, which apply retroactively, and have made it significantly easier to qualify for the R&D Tax Credit.  This is a very significant tax benefit and has either not been utilized or has been under utilized during the period the proposed regulations were open.

Many taxpayers continue to regard R&D as an activity associated solely with high-tech, biotech and pharmaceutical type companies.  However, under the new regulations, a company may qualify for the R&D credit for numerous activities that historically been regarded as “simply doing my job”.  

If your company is involved in any of the following activities, you may be able to claim the R&D tax credit: 
bullet

Manufacture products
bullet Perform certification testing
bullet Develop new, improved, or more reliable products/processes/formulas
bullet Develop or improve production/manufacturing processes
bullet Develop prototypes or models (including computer generated models)
bullet Develop, implement or upgrade systems and/or software
bullet Design tools, jigs, molds, and dies
bullet Develop production control software
bullet Develop or apply for patents
bullet Improve or build new manufacturing facilities
bullet Perform certification testing
bullet Automate and/or streamline internal processes
bullet Conduct testing of new concepts and technology
bullet Add New Equipment
bullet Development of new technology
bullet Attempt the use of new materials
bullet Perform environmental testing
bullet Expend resources on outside consultants/contractors to do any of the above stated activities

In addition, may taxpayers miss out on qualified R&D expenditures in areas such as engineering, quality assurances, marketing, purchasing, manufacturing, and information technology.

Click here for more information on this NEW TAX BENEFIT

THE BENEFITS

If your company has invested time, money, and resources on any of the above activities, including the advancement and improvement of your company’s products or processes, then you likely have qualifying research expenditures under the Federal R&D Tax Credit/Incentive Program. 

THE R&D TAX CREDIT OPPORTUNITY:
  • A hidden and immediate source of cash for many companies;

 
  • A significant reduction to current and future years federal and state tax liabilities;

 
  • Every successful company is potentially eligible for an R&D tax credit of some amount – many companies are  unaware that their day-to-day operations can qualify for the R&D Credit;

 
  • The 20% research tax credit is not a deduction.  It is an actual dollar-for-dollar credit against taxes owed or taxes paid.  Additionally, the taxpayer may be able to expense all such costs in the year incurred;

 
  • A business can take the credit for all open tax years – generally the last three or four years plus the current year;

 
  • Additional years may be available if the taxpayer is in a net operating loss or alternative minimum tax position;

 
  • In a flow-thru entity such as an S Corporation, the credit may be captured at the individual level and be utilized to offset other tax items;

 
  • Tax credits may carry forward twenty (20) years, thus creating a significant future benefit and source of capital.

THE APPROACH -

Sandersen Knox & Belt, LLP utilizes a team of highly focused professionals with proprietary methodologies to analyze your individual set of facts and circumstances and propose an implementation plan for your tax credit program.