Unlock Major Tax Refunds Through Uncaptured R&D Expenses
Last week, federal tax legislation was enacted that presents a significant opportunity for businesses with previously uncaptured or underreported R&D expenses to secure large tax refunds.
Many companies mistakenly assume the R&D tax credit only applies to stereotypical laboratory research in white coats. In reality, the credit applies broadly to U.S.-based activities related to design, development, or improvement of products, processes, or software. Employee wages, contractor payments, and material costs tied to development work often qualify.
In recent years, rule changes limited the benefit of the R&D credit by requiring the capitalization of R&D costs that had previously been deductible immediately. That requirement reduced the net tax benefit provided by R&D credits. The new legislation restores the immediate deduction of R&D costs, including retroactively to 2022 through 2024 for taxpayers under $31 million in annual gross receipts.
For many companies, this change can turn previously overlooked R&D costs into immediate cash refunds or substantial offsets against current and upcoming tax liabilities, including estimated payments for the 2025 tax year.
If your business:
- Develops or improves products, systems, software, or processes
- Has engineers, scientists, or other technical employees or contractors
- Has never claimed or fully explored the R&D credit, or recently took a reduced credit
You may be entitled to significant tax savings under this new law. Now is the time to re-evaluate your eligibility. Contact us today at (202) 455-6010 or submit our contact form to schedule a complimentary review and uncover what your business may be entitled to.
