What Are R&D Tax Credits

The research and development tax credit was originally created as part of the Economic Recovery Tax Act of 1981 and was made permanent with the Protecting Americans from tax Hikes Act of 2015. This credit is intended to promote domestic investment in research and development activities and is available to companies with increased levels of qualified research expenses. In most cases, the credit can be equal to 14% of your qualified research expenses and can often save taxpayers thousands of dollars for simply documenting activities that are performed on a daily basis. Do not pay the IRS more than you should. Let PriceKubecka help you document these activities and put those tax dollars back in your pocket.


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Qualified Research Activities (QRAs)

How Do You Qualify?

In order for an activity to qualify for the research credit, the taxpayer must show that the reserach activity meets ALL of the four tests outlined in IRC §41(d). These tests are:
 
 

Elimination of Uncertainity - IRC §174 Test

Is your activity intended to discover information that would eliminate uncertainty concerning the development or improvement of a product?

 

The Discovering Technological Information Test - Technological in Nature

Does your process of experimentation used to discover information rely on principles of the physical or biological sciences engineering, or computer science?

 

The Business Component and Permitted Purpose Test

Does your activity intend to apply the information being discovered to develop a new or improved business component?

 

The Process of Experimentation Test

Is your process of experimentation designed to evaluate one or more alternatives to achieve a result where the capability or the method of achieving that result, or the appropriate design of that result, is uncertain as of the beginning of your research activities?

Qualified Research Expenses (QREs)

What Expenses Qualify?

  • Wages paid or incurred to an employee for "qualified service" for QRAs"
  • Any amounts paid or incurred for "supplies" used in the QRA
  • Any amounts paid to another person for the right to use computers for QRAs
  • Contract research expenses paid to any person (other than an employee of the taxpayer) for QRAs

Contact us

Please complete this form to see if you qualify for a Research and Develpment tax credit? Please do not hesitate to contact us directly, call 972-888-0950. Our team will respond to you within one business day during regular business hours to help you.