R&D Tax Credit

« Federal Tax Compliance & Planning

Is your company getting all of the tax benefits available for the research and development you conduct? Many companies in the manufacturing, oil and gas, construction and engineering industries are performing activities that qualify for the federal R&D tax credit but are failing to take advantage of this lucrative tax incentive. The cost of labor, employee wages and contract labor costs, along with supplies incurred as part of a research and development initiative, may all be considered qualified research expenditures.

The R&D tax credit provided by Internal Revenue Code Section 41 has been the primary federal income tax incentive for conducting research and development activities in the United States since its enactment in 1981.

Renewed and extended for the calendar years 2012 and 2013 as part of the American Taxpayer Relief Act of 2012, the R&D tax credit provides a direct offset against income tax expenses in an amount equal to a statutorily prescribed percentage (6 percent–20 percent) of qualified research expenditures incurred during a tax year.

Below is a four-part test companies must satisfy to meet the R&D tax credit requirements:

Not sure if you qualify?  We can help.

We will conduct a review of your operations to identify potential qualified research activities to determine if you are a candidate for the R&D tax credit. Companies involved with the development of new or improved products, manufacturing techniques or production processes are likely to benefit.

Combining a deep understanding of tax law and experience in your industry, our tax professionals will apply the knowledge, insight and integrity for which Weaver is known.