Be prepared for R&D tax credits

Why being prepared is key to successful claims for R&D tax credits

Many companies across Texas do not claim the R&D tax credits that they are entitled to. The reason for this is generally these companies simply do not believe that they are entitled to the incentive. This is especially true for small and medium businesses which think that in order to receive the credits it is necessary to be a large corporation with laboratories and large scale projects.

This is not the case, and the current regulations mean that as long as the rules and definitions for receiving R&D tax credits are met, any company can make a claim.

The Need for Detailed Documentation:

The documentation required by the IRS to support claims for the R&D tax credit is very detailed. It is the company’s responsibility to provide evidence that they are entitled to the credits. Unfortunately, many companies find the rigorous level of documentary requirements difficult to comprehend and sustain.

This is why it is key to have a team of people with the technical expertise required who know exactly what is needed and how to get it. Having an intimate knowledge of the legislation and law around the subject of R&D taxation is vital for companies in Texas. Providing the IRS with the right information and guaranteeing that companies receive the tax credits to which they are entitled is of high importance.

Getting it Wrong is not an Option:

Companies rely on the R&D tax credit payments as part of their ongoing strategy and to provide financial support for projects. Losing such tax credits is not an option for many companies. This is why it is important to ensure that the documentation and information provided to the IRS is as comprehensive and supportive to a claim as possible.

There is not enough knowledgeable resources within many companies to reliably understand the high level documentation that is required and therefore claims become burdensome. Providing the IRS with documentation which is either incorrect or insufficient results in lost claims and the loss of important finances.

Expertise and Support:

As well as providing advice and support with the original R&D claim, it is important to know that the tax credits be sustained. The knowledge and experience of a specialist team means that advice can be provided about how to keep documentation at a level which means that any future audits and reviews are simple and efficient.

Any legal or taxation matters that arise from claims can be professionally taken care of with little need to interrupt a company’s normal business work-flow. The knowledge that this support is always there in turn provides companies with the confidence that their project budgets and finances are being maintained.