By following the rules of engagement, escalating where appropriate and collaborating with the taxing authority at every level, the taxpayer was ultimately able to sustain 95% of its R&D credit refunds.
Our clients say:
“They really go to bat for you. It doesn’t matter how much time it takes, or how many hoops they need to jump through. They don’t give up.”
As this Fortune 500 company expanded operations to more states, additional state R&D tax credit opportunities became available. TCC prepared a multi-year analysis claiming a significant state-level R&D credit benefit on behalf of this client. During audit, the state taxing authority proposed a complete disallowance, based primarily on a legal position adopted by the state.
Collaborative and Persistent:
- Since our approach embeds IRS and state controversy experts from the beginning of every study, TCC was prepared for the audit and able to react quickly and effectively. Our first step was to request a detailed write-up from the auditor to understand the state’s position for disallowing the credit. Upon review, TCC requested, and the state granted, a review by the state’s technical expert. The state subject matter expert upheld the auditor’s findings.
- Understanding the importance of procedure and the rules of engagement with the state taxing authority, our R&D controversy specialist elevated the issue to the state’s legal department. Ultimately, the legal division agreed with TCC, the auditor’s decision was reversed, and the claim settled at 95% allowance, avoiding the need to go through a lengthy appeal process.