Federal and state R&D tax credits are a valuable benefit to businesses developing new or improved products, improving manufacturing processes, engineering designs or developing software. Legislative changes have expanded monetization of the credits by allowing research credits to offset payroll taxes and generate state refunds even if there is no tax liability due to net operating losses. Companies should pursue research credits to help fund innovation and growth. Companies receive thousands and large companies receive millions of dollars from maximizing this tax credit.
“You will not find a more knowledgeable, thorough and efficient group in the R&D Tax Credit environment than Advanta.”
Birket Engineering, Inc.
The R&D Tax Credit is frequently understated or misunderstood. The definition of research applies more broadly than many businesses understand. The subjective nature of qualifying and documenting activities leads many businesses to not claim the credit or include an amount in the tax return without a thorough analysis.
The qualifying R&D activities and related costs must be presented by project or business component. The contract terms for R&D performed on behalf of a customer must be analyzed to determine qualification.
For example, a company asked us to analyze the R&D tax credits completed by their tax preparer as part of the tax return preparation. The Georgia based company currently claimed a federal credit of $120,000 and 0 Georgia credit. The only support for the credit was one spreadsheet. Our analysis generated credits of $505,046 with a full support package to sustain the credits if audited. Our fee was $30,000.
Advanta’s technical experts include CPAs, engineers, software developers and attorneys. Our clients tell us that utilizing highly experienced professionals minimizes the investment of time their technical personnel invest in documenting the research activities. We discuss the technical details, review your engineering drawings and calculations, photos, user stories and sprint reviews and create an integrated report. Our clients tell us this method takes less time on their part and provides more details in the final package than having their people complete questionnaires.
We apply our expertise to your business in order to understand the facts, apply the tax law, and deliver high-quality documentation that provides the support necessary to sustain the maximum available federal and state tax benefits. Our record in representing taxpayers in IRS examination and appeals cases is unsurpassed. Our audit-ready documentation and examination strategy supports quick settlements with the taxing authorities.