Does Your Texas-Based Company Qualify for Research and Development Tax Credits?
Even though research and development tax credits sound like a boring topic, the results that your Texas-based company receives can be lucrative and help to expand the financial growth and stability of your business. It’s imperative that you become familiar with the qualifications so that you can partner with a team of professionals to ascertain the amount of credits for which you qualify; remember that knowledge is power and expertise is the thread that ties your company to this dynamic new tax break.
The Four-Part Test by the IRS
You should investigate this four-part qualifying test offered by the IRS to ascertain if your company will be entitled to claim a research and development tax credit on your company’s returns. The criteria include:
- The activity performed must be technological in nature
- The activity must be intended to develop or improve a product’s functionality, performance, reliability, or quality
- The activity of your business operations must be intended to eliminate uncertainty
- The activity must include a process that involves experimentation to test and analyze hypotheses
After reviewing all of these stages of your company’s research and development activities, you’ll want to make notes and take a few additional steps to make sure that you qualify before you contact experts who can guide you through the tax credit claiming process.
Does Your R & D Qualify?
Many small to medium-sized companies here in Texas overlook this tax credit because they think their companies won’t qualify. It’s important to be aware of some of the basic qualifying activities that can bring lucrative returns back to your company so that you can reinvest in additional products and services that you offer to your clients. Stop and ask yourself if your company participates in engineering and new product designs. Has your company’s work been done in Texas? Did you participate in patent efforts or the development of a prototype for the market? Have you conducted laboratory or certification testing to determine product standards? If you can begin to see that your company does qualify for research and development tax credits; partnering with the right team of professionals is your next step in claiming the return that you deserve.
Professionalism is Your Key to Cash
To navigate the maze of regulations as they pertain to IRS tax credit claims you must have experts who are well-versed in Texas case law, the qualifying activities in which your business must have engaged during the filing period, and the expenditures that you have made that qualify you for a substantial cash refund that you can reinvest into your company. Our team at Texas R&D Tax Credit Solutions will offer you a service in which we will provide transparency in our dealings with you and your Executive Team, insight as we advise you about the proper way to proceed, and simplicity in our explanations of what we have found and the criteria that you have met to qualify for R & D tax credits.
Accompanied by our trusted professionals and credible documentation to support our claims, you will be well on your way to filing a return that furnishes you with R & D tax credits that will help grow your Texas-based company.