Research & Development Tax Credit Services
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TCC’s audit-ready approach and innovative technology are above the pack.”
– SVP, Global Tax, Fortune 500 technology company
Experts at Every Stage
Our team will present risk analyses and alternative credit scenarios to ensure that you can make an informed decision based on your company’s risk tolerance.
Quantitative and Qualitative Approach
Our team will speak with your subject matter experts to calculate the R&D credit, and support the credit by preparing technical reports demonstrating qualification.
Our Proprietary Process
Our 30-step process is vetted to stay current with IRS requirements. Developed by a former Big 4 IRS controversy leader specializing in R&D tax credits, the design incorporates input from an external consulting firm of ex-IRS engineering territory managers.
Discover the Difference
TCC’s service process includes unique technology elements, such as proprietary web-based project, activity and time allocation software.
TCC also provides a dashboard and reporting framework featuring audit and risk-scoring analytics that are unmatched in our industry.
TCC has experience in niche areas, including the ASC 730 R&D Safe Harbor and R&D credits for “retail transformation”, including distribution automation technology, e-commerce and omni-channel software projects.
R&D Tax Credit FAQs
- Reduction in risk/increased credit retention
- Reduction in R&D credit reserve, leading to increase in earnings
- Reduction in time (and fees) spent in audit
- Reduction in time spent on fieldwork
Any company can use the R&D tax credit against federal income tax. However, small businesses and startups may be in a loss position in their earlier years, so they may have to wait several years before they are able to monetize their credit carryforward against federal income tax liability.
The PATH Act of 2015 set forth provisions to allow certain eligible small businesses and startups to utilize their federal R&D tax credit against the employer’s portion of quarterly payroll tax subject to FICA. This allows for more immediate monetization of the credit than ever before.
In order for a company to be eligible to use their R&D tax credit against payroll tax, the following two criteria BOTH must be met:
Entity must have less than $5 million in gross receipts for the credit year in which the credit is being claimed;
Entity can not have had ANY gross receipts prior to the 5-year period ending with (and inclusive of) the tax year in which the credit is being claimed.
The R&D tax credit claimed on the annual tax return offsets the payroll tax liability in the quarter following the quarter in which the annual tax return is filed.
The credit serves to reduce the payroll tax liability in that quarter, which would have otherwise been due.
Any credit amount in excess of quarterly payroll tax liability is carried forward to subsequent quarter(s).
Leading enterprises are investing in product and software developers, who qualify for valuable credits. Additionally, faced with so much change, so quickly, retail outlets are transforming in the areas of e-commerce, supply chain and distribution management.
Employers hire TCC to find, calculate, verify and document and monetize available R&D tax credits. TCC applies the rules, regulations and accepted audit preparation procedures to prepare an audit-ready deliverable for the employer. TCC monitors ongoing changes regarding the incentive, including legislative, regulatory and legal developments to ensure the client maximizes value while minimizing risk and the impact on business operations.