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R&D Tax Credit

Technical topics regarding tax preparation.
#1
Posts:
26
Joined:
7-Sep-2015 5:38pm
Location:
los angeles
Have three requirements:
1) Gross receipts of less than 5 years
2) Gross receipts of less than $5,000,000.
3) Need to participate in the R&D

Four-part test:
1) New & Improvement- Improvement of existing or create new
2) Eliminate uncertainty - Capability issues & approaching of design
3) Process of Experimentation- Evaluate one or two alternatives, Trial and error
4) Technological in Nature -


The cost that can be included:
Employee wages
Supply cost (not applicable to you)
Contract Research

tax credit depending on the type of expense it is- This can be a credit against payroll taxes or could flow through the K-1's. Still researching

My question is: if the business started in 2018 and meets all the requirements. How is this filed (separately or with a tax return) and how do you apply the credits towards payroll taxes? Also, if we choose to take the credit directly on the K-1, How is this done on Drake Software?

Thanks in advance!
 

#2
Nilodop  
Posts:
11698
Joined:
21-Apr-2014 9:28am
Location:
Pennsylvania
Most if not all of what you need is coverd in Forms 6765 and 8974 and their instructions.
 

#3
Posts:
26
Joined:
7-Sep-2015 5:38pm
Location:
los angeles
Thank you
 

#4
juro  
Posts:
270
Joined:
18-Oct-2015 9:11am
Location:
USA
 


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