Utilizing Tax Credits
Per Stacy deru and Steve Adams at Engineered Tax Services:
Most businesses hire a CPA to compile and file their tax returns based on quarterly and yearly deadlines. These often involve writing a hefty check to the IRS. While we at Engineered Tax Services believe everyone should pay their fair share, we also live by ~ “there is no need to leave a tip”.
There are many incentives and credits businesses are not taking advantage of. Less than one-third of businesses who are eligible know they are. This is where a good tax strategist can identify incentives and partner with your CPA to take advantage. Below, four commonly overlooked tax strategies A/E firms and their clients should be utilizing to maximize profitability.
R&D Tax Credits R&D credits can exceed 10% of eligible costs related to developing new products, processes, or inventions. Over 40 states in the U.S. also have R&D credits than can be stacked with the federal. These credits amount to substantial savings year over year and can be utilized by start-ups. Many A/E firms don’t know they’re eligible for R&D tax credits. Credits are intended to stimulate innovation, technical design and product develop, keeping the U.S. a leader in innovation. Many qualifying activities seem like day-to-day operations for an architect or engineer, yet meet the qualifying standards for R&D.
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