Companies all across America have been changing the use of their time and resources to keep up with the shifting landscape of their industries. Because of this, businesses have needed to conduct research and development activities to create new and improved products and services. To help companies keep up with this growth, federal and state governments have created tax credits to help pay for the expenses that go along with these industry advances.
In the state of Georgia, any new company, start-up, or existing and established company who takes part in R&D or is expanding their R&D budget can be considered for these credits.
What Activities Would Qualify For Georgia R&D?
For research or development to qualify for these credits, it must be performed in the state of Georgia. It must also be technological in nature, create new or improved products, services or methods, eliminate any uncertainty, or involve a process of experimentation.
R&D isn’t only limited to activities like lab research. Anything that involves innovation can be considered. For example, developing prototypes for new products or processes, conducting tests, manufacturing new equipment, developing applications or other technologies to make customers’ experiences easier, can all be considered for these benefits.
How Are These Credits Calculated for Georgia Businesses?
Once your company has submitted both the Form IT-RD and Federal Form 6765 along with your Georgia income tax return, the following is done to calculate the R&D tax credits you’ll receive:
- Credits are equal to 10% of the excess of the Qualified Research Expenditures (QREs) over the base amount
- After all credits have been applied, they can be used to offset up to 50% of net Georgia income tax liability
- Any excess credits can be used against state patrol withholdings
- R&D tax credits that aren’t used can rollover for up to 10 years
The Next Steps To Gain Dollar-For-Dollar Credits
Claiming R&D tax credits takes time and all the correct documentation should be in order before any applications or forms are submitted. Having a team of tax experts on hand to help can give your company the professional assistance needed for this process.
Our team of experienced tax professionals at National Tax Group are here to help. Give us a call at (561) 257-3436 to schedule your free initial assessment so we can get you the dollar-for-dollar credits your business can qualify for.
