When you hear “Research and Development (R&D) tax credit,” your mind does not go directly to breweries, jewelry design, or food products, right? That self-selection process is precisely why many small business owners miss out on sizeable tax incentives by not applying for R&D funding. However, each of these industries and many more receive funding annually because they try innovative methods or develop new products for their workplaces. Amazingly, R&D and other related tax credits save U.S. businesses more than 6 billion each year; however, many business owners are not aware of this opportunity to be awarded for conducting their business as usual.
The R&D tax credit is absolutely a way to encourage American ingenuity and prosperity. Initially designed in 1981 and made permanent with the PATH Act of 2015, this credit aims to reward American business to invest in and conduct research. With rapid technology changes, the credit has been extended as companies across many industries have utilized this incentive to remain competitive in a global market.
If you are engaging in developing or improving your sector, the R&D credit might be just the push you need to help you continue to be competitive in our economy. This credit is now available to any U.S. business that spends time and resources on new improvements, development, or technological advances to advance products or practices. This tax incentive gives the possibility of obtaining credits, refunds, grants, overcharges, premium reductions, or other recovery/savings for up to the past three years of your small business operations.
We know those are some long lists of eligibility requirements, but the bottom line is that what your business is already doing or what you hope your business could be working towards might qualify for a R&D tax credit. Let us know if you would like to look into this funding option that furthers the American dream for business people around the country. We look forward to seeing your business innovations rewarded.
1. Research and Development (R&D) tax credits are in place to encourage innovation and development in American businesses
2. Most businesses assume their industry are not eligible for this tax credit, however there are a broad list of industries and companies that benefit from R&D funding
3. Credits can be obtained for up to the past three years of operations
Justin Martin is a Senior Wealth Advisor for Legacy Wealth Management, with his office based in the Salt Lake City area. Justin works with small business owners and doctors throughout the United States and is passionate about helping individuals prepare for a robust financial future. Justin completed his Master of Business Administration (MBA) at Texas A&M University and completed his undergraduate studies at Brigham Young University. Justin is FINRA series 65 licensed, has been working as a Wealth Advisor since 2006, and is currently a board member with the International Association of Registered Financial Consultants. He also works as an adjunct professor of microeconomics and loves studying financial systems. Justin and his wife Megan have four kids and love all things active and musical.
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