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Research and Development Tax Credit

Since 1985, ABGi has been providing the highest level of service for the Research and Development (R&D) Tax Credit  for our clients. By using our unique Business Component Approach with an established nexus, ABGi maximizes the  R&D Tax Credit, while at the same time providing superior documentation to ensure that the claim stands up to the highest level of IRS scrutiny.

In a recent IRS published article, the following facts were posted in regards to actual R&D credits claimed:

  • $11.6 Billion in R&D Expenditures were reported on individual and corporate tax returns;
  • Manufacturing was actually the largest sector to claim, but only 6,219 of 15,873 Manufacturers actually took the credit (39%);
  • Businesses of $250 Million of sales or more account for 14% of all claims made, but this 14% accounts for 84% of the total credits claimed;
  • Companies with less than $50 Million in sales account for 72% of all filers, but this represents only 11% of the credits claimed.

Clearly the R&D Credit is severely underutilized; this is where ABGi USA can help you!

 

R&D Tax Credit Benefits

  • Provides a dollar for dollar reduction on federal and some state income tax liability;
  • Taxpayers can claim Federal R&D Tax Credits retroactively, and receive cash back by filing amended returns for the past three years;
  • Approximately 36 states have their own R&D Tax Credit programs to reduce state tax liability;
  • Eligible small businesses previously limited by the Alternative Minimum Tax (AMT) can use the R&D Tax Credit to offset AMT, and effective as of 2016, they can use the R&D Tax Credit to reduce their tax liability;
  • Incentivizes innovation in the USA by ensuring the retention of highly skilled personnel in the USA;  and
  • Any R&D Tax Credit not used can be carried forward up to 20 years.

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