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CALIFORNIA R&D TAX CREDIT
We understand the complexities of navigating the intricate landscape of R&D tax credits, particularly in California. Below is why our expertise stands out.
Learn more about how our California consultants can help you work through these tax debt relief options in Irvine and schedule your free consultation now!
Specialized Knowledge
Our team comprises seasoned tax professionals with in-depth knowledge of both federal and California state R&D tax credit programs. We specialize in maximizing your benefits while ensuring compliance with all regulations.
Personalized Approach
We recognize that every business is unique. Our approach is tailored to your specific needs, ensuring that you receive the maximum tax benefits applicable to your research and development activities.
Seamless Process
Claiming R&D tax credits can be daunting, but with our team, it's a streamlined process. We handle everything from assessing your eligibility to organizing your documentation, ensuring a hassle-free experience for you.
Expert Guidance
Navigating tax regulations can be overwhelming. With our expertise, you can rest assured that you're in capable hands. We guide you through every step of the process, providing clarity and peace of mind.
Audit Support
In the unlikely event of an audit, we stand by you every step of the way. Our team assists you in addressing any inquiries from the IRS, ensuring that you're well-supported throughout the audit process at no additional cost.
Dedicated Service
Your success is our priority. We are committed to delivering exceptional service, promptly addressing your inquiries, and ensuring that you receive the full benefits of the R&D tax credit program.
How does R&D tax credit help companies or businesses?
Companies are eligible for the R&D tax credit if they incurred expenses while conducting qualified research in California. These expenses must be directly correlated to the research they were doing. Taxpayers can claim the California R&D Tax Credit using FTB Form 3523, for the year they spent on qualified research and development expenses in California.
Businesses can take advantage of this by using the credits to offset their costs of research and development against California state and federal tax liabilities. That means they will practically get a refund. This tax credit is often overlooked by companies simply because they don’t realize that the work they do daily qualifies them for this perk.
The California R&D Tax Credit program qualifications and benefits are very similar to the Federal one, but they also have a few differences.
California State R&D Tax Credit Program Highlights
- The credit rate pertaining to the California state R&D credit is 15%, lower than the federal level, which is 20%.
- All research activities must be proven to be qualified, and must have been done in the state of California to be considered eligible for the R&D credit.
- Unused research credits will never expire.
- Compared to other states, California has a different definition of gross receipts for companies that provide services.
Federal R&D Tax Credit Program Highlights
- More than $7.5 billion in federal R&D credits are awarded to companies conducting qualified research activities in the United States every year.
- The program provides cash incentives in the form of credits for companies performing research activities in the country, reducing current and future federal tax liabilities.
- Tax credits may be credited for a maximum of 20 years.
- The credit can be taken by a business on all open tax years – typically the last three or four years – plus the current year.
What is the Research and Development Tax Credit?
R&D is a dollar for dollar tax credit that can be claimed by companies in the United States to offset costs spent performing research and development to benefit their business. It was created as an incentive by the United States Government for businesses to continue developing and improving their products, processes, or software.
The R&D credit was made permanent on a federal level by the Protecting Americans Against Tax Hikes Act of 2015, allowing business owners to ensure their related activities would earn them credit. The PATH Act also allowed for a number of different industries to be eligible to claim the credit.
How do you claim the R&D Tax Credit?
Our team at National Tax Group makes claiming your R&D tax credits simple. During our call, we’ll determine if your research activities will qualify you for the program. Give us all your documents as proof. We’ll organize them for you so that you’ll have a faster and easier process getting approved by the Internal Revenue Service.
An audit may be called for, but in this highly unlikely event, don’t fret – we’ll make sure to stay with you through the process and help you answer any questions the IRS may have for you, until the audit is finished. All of this at no extra cost!
Contact our tax experts today, and let’s get started!
You can email us at info@globalgatecpa.com or call us at (833) 244-4141 for more information.
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