Software and technology companies have benefited from R&D tax credits for over 30 years. Companies that have developed software that is for sale, lease, or license more than likely qualify for an R&D credit program. Additionally, companies that have developed software for internal use are now able to claim credit due to recently implemented Internal Use Software (IUS) regulations. If your company develops software in any industry, then there is a strong likelihood that the company could benefit from an R&D tax credit study. Let TaxIncennovations help you get onto the path to valuable R&D tax credits for your company today!
Examples of qualifying R&D activities include the following but are not limited to:
Evaluation and testing of code
Developing technical specifications
Internal-Use Software in support of R&D
Developing and designing software architecture
Developing and designing new or improved technologies, databases, and algorithms
Prior to 2016, small to mid-size companies who qualified for the R&D tax credit were sometimes limited to utilize the credit by Alternative Minimum Tax (AMT). With the new regulations put in place in 2016, small to mid-size businesses can offset their AMT with the R&D tax credit.
A Software Development Company with gross receipts of $15 million that develops energy trading software can generate $225,000 in R&D Tax Credits per year.
A Technology Company with gross receipts of $12 million that designs and develops computer components and parts can generate $120,000 in R&D Tax Credits per year.
Let TaxIncennovations evaluate how we can assist you in claiming R&D tax credits.