One of the most lucrative tax benefits for companies who are performing and undertaking innovative approaches to their products or services are research and development tax credits. Now more than ever, companies in a wide range of industries can qualify for these dollar-for-dollar tax perks if they are performing activities that are advancing their industry.
With continual growth in many markets, most businesses are required to perform research and development to keep up with industry demands and may not even know they are performing R&D on a daily basis. In fact, less than 1/3 of companies utilize R&D tax credits.
Think your business applies for these credits but you didn’t claim them on your 2020 taxes this year? Well, don’t panic because we got you covered.
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Companies who have performed research and development activities in previous years but have not claimed them on past taxes still have the opportunity to claim R&D credits and amend their taxes as far back as 2018.
Our team of tax professionals offer assistance before, during, and after your tax applications are completed, but we also make sure you haven’t missed out during any previous years. While working with you, our tax experts will make sure all prior years are reviewed and you’re getting the most out of your claim in the process.
What Type Of Activities Would Qualify For These Credits?
The requirements to qualify for these credits are done by using a 4-part test. The test states that your business has to perform the following to qualify:
- Activities that improve the quality, function, or reliability of a process or product
- Identifying information to remove ambiguity in the development or improvement of a production process
- Activities that include a systematic process such as stimulation, logical trial and error, assessing alternatives, and refining hypotheses
- Activities that are technological in nature (i.e. physical sciences, biological sciences, computer sciences, or engineering)
What Types Of Industries Would Qualify?
Multiple industries are able to apply for R&D tax credits and are available to any business in any industry that performs qualifying research activities. Some example industries include:
- Architecture, Engineering, Construction
- Chemical Pharmaceutical, Biotech
- Food & Beverage, Food Sciences
- Software Development, Web Development, Computer Sciences, Education Technology
- Telecommunication, Aerospace & Defense, Financial Services
- Apparel & Textiles, Cosmetics, Automotive, Manufacturing
- Renewable Energy, Agriculture
What Are Your Next Steps?
Applying for and claiming these credits can be complex and requires a team of tax professionals to help guide you through the process. Here at National Tax Group, we have assisted companies of all sizes and industries in obtaining R&D credits. Call us at (561) 257-3436 to schedule your free assessment today!