Research and Development Tax Credit Facts

The R&D tax credit is a general business tax credit enacted in 1981 with the intent to stimulate the economic investment within the United States. The credit is an incentive for businesses of all sizes to invest in research and development activities and increase technological growth and competitiveness. This credit was made permanent as of December 18, 2015 and offers ongoing incentives for R&D investment.

  • Federal and State Tax Credit
  • Designed to stimulate innovation, growth, and global competition by U.S. companies
  • A dollar for dollar reduction of tax liability
  • Excess credit can be carried back 1 year and forward 20 years
  • R&D Credit Studies can be performed on all open tax years
  • Most industries contain R&D credit opportunity
  • Applicable for not only established businesses but also first year companies
  • Annually more than $12 Billion in Federal and State credits are claimed
  • Less than 5% of eligible businesses currently apply for the credit
  • Increase cash flow in current and future years