Tag Archive for Form 6765

Startups Can Now Claim R & D Tax Credit

Startups with qualifying research expenses have for the first time an additional option whereby they can choose to apply up to $250,000 of its research credit against its payroll tax liability. This new option is available to any eligible small business filing its 2016 federal income tax return this tax season.

If, somehow, such a small business failed to choose this option while filing their 2016 Tax return, and still wishes to do so, it can still make the election by filing an amended return by Dec. 31, 2017. This new option was introduced through the PATH Act enacted in 2015.

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A Practical Guide To The Enhanced R&D Tax Credit Program For Eligible Small Businesses And Eligible Start-Ups

Peter Scalise

The Federal-Level Research and Development Tax Credit Program (hereinafter “RTCP” or “RTC”) was originally enacted into the Internal Revenue Code (hereinafter “the Code”) through the Economic Recovery Tax Act of 1981 as a temporary provision of the Code at a time when research and development jobs were significantly declining throughout the United States. Notably, the RTCP was introduced into the Code to encourage businesses to invest in significant research and development efforts with the high expectations that such an advantageous tax incentive program would facilitate in stimulating economic growth and investment throughout the United States and prevent further jobs from being outsourced to other countries.

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Written by | Posted in Small Business • Tax Credit • Tax Provision/Tax Reporting