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Common Challenges When Claiming R&D Tax Credits

Rachel Bishop, CPA

Senior Director, R&D

The R&D tax credit is a governmental incentive designed to encourage research and development activities in the US. This credit offers a dollar-for-dollar reduction on federal taxes for qualified expenses related to developing new or improved products, processes, software, technique, formula, or invention.

Although claiming this credit can offer considerable benefits for companies engaged in Research and Development efforts, the process is not without its challenges. Three Common Challenges You May Face while Claiming R&D Tax Credits:

Documentation of Qualified Activities and Expenses

Updates to R&D Tax Credit Law

Staying Compliant and Audit Ready

Companies who want to claim the R&D Tax Credit should consider working with or seeking advice from tax professionals with a robust background in R&D. Source Advisors reviews eligibility of business activities and integrates with various payroll platforms to gather expense details.

With over 350 collective years of experience across a national team of more than 50 R&D tax credit experts, we stay updated with and ensure our users are aware of all legislative changes. Source Advisors prepares a fully compliant R&D study report for tax filing, including federal and state tax forms which gives our clients peace of mind in the event of an IRS audit.

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