A permanent R&D Tax Credit offsetting AMT and Payroll Taxes is in the works


Cleveland – Dec. 17, 2015 — As introduced this Wednesday, the Consolidated Appropriations Act of 2016 contains a provision for a permanent research and development tax credit. In addition, new rules would allow taxpayers with gross receipts less than $50 million dollars to utilize the credit to offset Alternative Minimum Tax liability. Also, for certain startup phase businesses, the credit could be used to offset payroll tax liability. (Click here to learn more about the proposed legislation.) With these new provisions included in this legislation, there will be a massive expansion of companies who can now take advantage of this incentive.

“In my 30 + years working in this area of R&D Tax, never did I think I’d see the day when a permanent credit would become enacted,” said Michael Krajcer, President of Tax Credits Group. “This is truly an exciting development and will allow taxpayers to now properly plan and budget R&D based on the benefits of this incentive. Let’s all hope the final bill contains these favorable changes.”

It’s expected that congress will vote on the final bill by Friday, with the White House having already indicated that they will sign-off on the bill if passed.

For questions on the proposed R&D legislation, or to learn more about the eligibility to claim the Federal Research and Development Tax Credit, please contact Bethany Jones-Worner at Bethany@taxcreditsgroup.com.

About Tax Credits Group:

TCG is an Ohio-based specialty tax consulting firm working to help innovative U.S. businesses of all industry sectors stay globally competitive. With headquarters in Cleveland, TCG specializes in federal and state research credit studies for small to mid-size manufacturers, software developers and financial institutions. TCG also specializes in business compliance acquisition work for large to mid-size businesses. Learn more about TCG at www.taxcreditsgroup.com.

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