The Research and Development (R&D) Tax Credit is a government-sponsored tax incentive that rewards companies for conducting research and development within the United States. These tax credits benefit both small and large corporations alike and are available to a wide variety of disciplines in the applied sciences field and other technical research areas.
Read on to learn more about the R&D Tax Credit and determine if this could be the right direction for your company!
The main objective of the R&D Tax Credit is to grant funding so that companies can promote internal innovation, thus helping the overall economy. It is an excellent way for businesses of all sizes to obtain capital while stimulating research activities dedicated to enhancing their products and services.
The R&D Tax Credit aims to:
Nowadays, most companies conducting product testing, employing engineers, engaging in data science and analysis, or outsourcing product research are eligible to claim the credit. However, please take into account that you will have to present a component of hard science in the research to meet the incentive’s requirements. We advise you to keep detailed records of your business expenses to help prove that you qualify for the incentive.
In order to determine eligibility for the R&D tax credit, a four-step, IRS-enforced test is followed to ensure all required parts are met.
The size of your company or the business sector doesn’t matter. The R&D tax credit is for every company that improves its business somehow; it can be processes, products or services. The government rewards 10% of all expenses that companies conduct in activities considered as innovation, research or development at a federal level and might be increased at a state level.
As with any other grant application, the more documentation you present relating to your research and development activities, the higher your chances of obtaining the credit will be. Some of the most important documents you should always keep nearby are:
FI Group USA is committed to supporting innovative companies of all sizes in their research and development ventures. If you have recently invested in new products or processes and would like to know if you are eligible for R&D tax credits or refunds, we are the place for you.
Contact us today to tell us more about your project; we look forward to collaborating with you!