Tax laws favor pursuit of innovation.
Every year, companies claim billions of dollars in R&D credits, directly offsetting their tax liability. And every year, billions of dollars in credits go unclaimed because many companies don’t realize that they are eligible.
Any company, in any industry, that has devoted resources toward developing new products, processes, or software – whether successfully or not – is eligible. Even companies attempting only to improve their existing products, processes, or software are eligible.
The benefits can be significant, including increasing cash flow as much as 9.1% of qualified spending for federal taxes and as much 40% of qualified spending in some states; reducing effective tax rates; and increasing earnings per share. In addition, more than 35 countries have R&D credits and incentives, benefits often more generous than those available in the U.S.
BDO offers the following services to help companies determine whether they are leaving cash on the table or could more efficiently and effectively claim their R&D credits: