Don’t Miss Out on Research and Development Tax Credits
2023-11-05 – BE&O show A&B
While they may not be the most exciting topic in business, tax credits can be a crucial part of your business plan, and they can go a long way in improving your bottom line. Courtney Kincaid, President and CEO of The Indiana C-P-A Society, says many small business owners are missing out on the research and development tax credit.
Not just for Silicon Valley, the research and development tax credit is available on a federal and state level. However, almost 80% of businesses eligible for a research and development tax credit are not claiming it on their annual filings.
While it is tech companies who mostly leverage the tax credit, it can also be applied by other business sectors looking to develop new processes and innovations in several different markets.
Kincaid says it’s important to consider how research and development fit into your business accounting. She also says it’s critical to think about how you are innovating at your business because, if done properly, that may open up access to the tax credit.
Not every business will be awarded the credit, so it’s important to understand what is needed to support the tax credit. Kincaid says your CPA is your best advocate. “They understand the nuance, and they can help.” And even if your initial claim for the tax credit is denied, your CPA can help you resubmit for reconsideration.
Kincaid also warns small business owners to watch out for predatory companies that will overstate the value of their credits or submit inaccurate and false paperwork on their behalf. She says it is best to rely on your CPA to look at the full picture and help you apply for the credit.