Research & Development tax credits reward economic risk-taking by companies that create or improve products, processes or software. The federal government and most state governments offer research incentives to encourage and attract hiring and investment in value-added activities within their jurisdiction. The total amount of federal and state R&D credits claimed annually exceeds $10 billion.
Although the United States was the first country to offer an R&D credit in 1984, most other competing countries now have research incentives that offer more value than the US credit. Since federal and state R&D credits continue to become broader in applicability and higher in value, it is important for companies to pay close attention to properly calculating and documenting this annual recurring tax benefit.
Tax Credit Co. (TCC) is one of the largest independent providers of R&D tax credit services in the United States. We help companies of all sizes and industries to identify and secure federal and state research & development tax credits nationwide. Our clients include many industry leaders in manufacturing, energy, engineering, retail, transportation, information technology, healthcare, biotechnology, medical devices, automotive and aerospace.
We Think Differently About R&D Credits
At Tax Credit Co., our goal is to produce an audit-ready R&D tax credit study built on contemporaneous data and documentation that fully supports our client’s tax credit claim. At TCC, we avoid the time survey estimation approach disfavored by the IRS and instead work to utilize a project accounting methodology supported by our own proprietary technology. We believe that most companies have the data and records available to properly document the credits and avoid basing a claim on estimates. This is in line with the preferred methodology outlined by the IRS in its R&D credit audit manual. As well, we attempt to work collaboratively with the IRS whenever possible. Because of this, we have achieved an audit acceptance rate exceeding 97%.
Tax Credit Co.’s approach to securing R&D credits for clients reflects the following values:
- Identify all opportunities possible by casting a wide net
- Rely on data and documentation rather than subjective assessments of staff members
- Shift burden of data collection, research, records gathering and calculations to us rather than the client’s overburdened internal resources
- Solve high-value problems with innovative solutions
- Make the audit process simple and uneventful by providing auditors with data and documentation in an organized and clear format.
The resulting benefits for clients often include:
- Smoother process with less strain on internal resources
- More accurate and complete calculations, documentation and work papers
- Increased credit amounts due to the comprehensive approach and resolution of compliance challenges within the business
- Higher certainty and less contentiousness in federal and state audit.
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