Research and Development Tax Credits
Investment in innovation—whether to develop a new product or a new process—not only benefits a company’s market position, it can substantially reduce its overall tax liability as well.
First introduced in 1981, the research and development (R&D) tax credit incentivizes companies to increase their annual investment in R&D by providing a credit against their taxes of up to 20 percent of qualifying R&D expense over a specified base amount. This credit has enabled businesses to create jobs, enhance workforce skills and expand the R&D capabilities they need to remain competitive in today’s global business economy. Qualifying expenses can include wages, supplies, rent or lease of computers, and certain third-party payments.
With deep experience in this highly specialized area of tax credits, CohnReznick can help companies lower their R&D costs by uncovering these tax credit opportunities. Our services include:
- Credits studies: We can conduct a study of R&D investments to identify qualified expenditures that are often missed.
- Tax return analysis and amendments: We can analyze open-year tax returns, identify the opportunity for potential credits, and amend the return for refunds.
- Document preparation and examination support: We offer consultation services and implementation assistance to assure your documentation will meet IRS requirements. We can also provide assistance with US GAAP-IFRS tax reserve issues surrounding R&D credits and IRS and state tax auditors’ examinations of credit calculations.