The Internal Revenue Service (IRS) is proposing revisions to Form 6765 which pertains to the Research and Development (R&D) tax credits. These changes, set to be effective for tax year 2024 onwards, aim to capture more qualitative information, thereby potentially impacting how taxpayers approach their filings.
Let’s delve into the specifics of these proposed changes.
New Additions
PRE-SECTION A ADDITIONS
- The form will introduce two preliminary questions prior to Section A. Of these, one is entirely new and aims to gather details about whether the organization belongs to a controlled group or is under common control.
INTRODUCTION OF SECTION E
- It will inquire about the number of Business Components (BCs).
- The section will gather information on officer compensation.
- It seeks to understand acquisitions and dispositions.
- It will inquire if there are any new categories of Qualified Research Expenditures (QREs). If the answer is affirmative, the IRS expects taxpayers to update the base to incorporate these categories.
- It will ask about the use of ASC 730 Directive – but this can only be utilized by taxpayers whose assets are equal to or surpass the $10M mark.
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