By exploring, securing, and implementing available credits and incentives, you can potentially: avoid paying unnecessary taxes, obtain immediate tax refunds, manage operational costs, improve earnings before interest and tax, net income, and shareholder value, and enhance the economic value of the company initiatives. However, many different factors affect the specific types of credits and incentives that may be available to your company. UBOS can help you sort through the potential benefits along with the related requirements.
Recent tax laws are taxpayer-friendly and bring valuable benefits. In addition to federal tax credits, many states offer a state tax credit. Tax incentives are broader than many companies realize, which apply to product development and other activities and operations such as new manufacturing processes, environmental improvements, software development, and quality enhancements.
Tax Incentives and Credits provide permanent benefits to drive down effective tax rates, generate cash flow, and represent a dollar-for-dollar reduction of your income tax liability. You can claim the tax credit in addition to any tax deduction you take for expenses.
The credits have become more attractive for small companies in recent years because they’ve been simplified, can be transferred in an acquisition, and can be taken retroactively. Certain costs incurred in years when a company has no income can be carried forward to offset taxes on future profits.
UBOS focuses on those tax credit programs that generate the most substantial local, state, and federal benefits. Our professional team works directly with our consultants and clients to implement the most profitable credit and incentive transactions available. There are more than 7,000 federal, state, and local credits and incentives! Smart accounting and CPA firms seek outside assistance to take advantage of these valuable business incentives.
The Research and Development (R&D) Tax Credit remains one of the best opportunities for businesses to substantially reduce their tax liability. For what amounts to their daily activities, companies from a wide-range of industries can qualify for federal and state tax savings high to enough to allow companies to hire new employees, invest in new products and service lines, and grow their operations.
Now, due to numerous modifications and expansions over the years, more companies than ever before can benefit from this valuable incentive.
It would be best if you were getting more out of your credits and incentives program. It’s more than just the right people with the right skills. It’s more than a process that uncovers credits opportunities while minimizing disruption to your teams. It’s about bringing those key elements together with an industry-changing technology that provides you the information, analysis, tracking, communications, and updates that enable a proactive, value-added Credits & Incentives program.
Business today is rarely conducted within a single location. Often, companies have customers and product sales throughout the United States. State and local tax laws can be very complex and vary widely from jurisdiction to jurisdiction. Businesses often find it challenging to comply with these state and local regulations and avoid penalties and fines. Our state and local tax experts will monitor new tax laws and court decisions that will impact your business and provide easy-to-use compliance guidance for your staff.
UBOS believes that State and Local Taxes (SALT) presents an opportunity to realize significant cash savings with proper planning. As a result, we assist businesses with reducing their effective state tax rates, recouping tax overpayments, strategically planning for growth and development, and avoiding tax penalties and fines.
Cities and states continue to assemble attractive packages of incentives to attract business investment. Companies that maximize the use of incentives can improve return on investment and enhance shareholder value. UBOS can help obtain incremental tax advantages consistent with the strategic business direction of your organization.
The Research and Development (R&D) Tax Credit remains one of the best opportunities for businesses to substantially reduce their tax liability. For what amounts to their daily activities, companies from a wide-range of industries can qualify for federal and state tax savings high to enough to allow companies to hire new employees, invest in new products and service lines, and grow their operations.
Now, due to numerous modifications and expansions over the years, more companies than ever before can benefit from this valuable incentive.
The Opportunity
The federal R&D tax credit has been a part of the tax code since 1981, rewarding businesses in a wide variety of industries for making improvements to their products, processes, or techniques. The credit is designed to encourage the American industry to invest in research and development activities including but not limited to design, development, engineering, experimentation, trial and error, process improvement, software development and improvement, quality assurance and more. This wage-based credit is intended to stimulate R&D activities among businesses through tax incentives.
The federal credit (and the 43 state versions of the credit that have risen over the years) essentially reward those companies that are thinking bigger and better about their products or services, providing valuable tax credits for their R&D investment. Currently, the R&D tax credit and other related tax breaks save U.S. businesses more than $12 billion a year, as noted in the Washington Post.
Certainly, an impressive figure—and one that would be even larger if all eligible businesses in all qualified industries applied for the credit. The R&D credit is one of the most overlooked opportunities afforded to U.S. businesses, with most eligible companies (and, in many instances, their CPAs) self-censoring away from the credit.
Anytime a business makes changes to the design or development process to make it cheaper, greener, cleaner, better, and quicker, the business could be earning tax credits. This tax credit can be applied to both new product development as well as the production side of manufacturing, software development, fabrication, machine shops, agriculture, architecture, biotechnology, as well as a broad range of other industries. These dollar-for-dollar credits can make a positive impact on your bottom line.
Our financial tax team has vast experience in structuring these credits for our clients.
A number of factors go into claiming the credit, but the potential savings on the table make exploring the credit a worthy investment. Since the credit may be claimed for both current and prior tax years, companies can benefit from documenting their R&D activities to ensure they are positioned to claim the credit in both situations.
To claim the credit, the taxpayer must contemporaneously evaluate and document their research activities to establish the amount of qualified research expenses paid for each qualified research activity. While taxpayers may estimate some research expenses, they must have a factual basis for the assumptions used to create the estimates.
Examples of such documentation includes:
These records combined with credible employee testimony can form the basis of a R&D Tax Credit claim – and our comprehensive services can quickly identify and gather this information to substantiate your claim, ensuring you are receiving the full value you are entitled under relevant IRS guidelines and Treasury regulations.
Businesses in many different industries routinely do work that qualifies for significant business development credits, rebates, and rewards as they attempt to create products that are lighter, faster, less expensive… or more durable, reliable, or precise. As the pace of your business accelerates and competition increases, you may be more likely to overlook this source of cash because you lack the time, resources or expertise needed to identify and manage tax credit claims.
Let UBOS/BIS industry experts help you claim the credits that you deserve!
Even though the credit has been around since 1981, the credit has gradually evolved over the years, with many companies not even able to take advantage of the incentive until the changes that were made in 2015. Due to its gradual evolution over the years, many CPAs may not be up-to-date on the most recent policies and regulations regarding the credit. We have partnered with thousands of CPA firms in the past and have been able to assist them in providing this service for their clients.
Nope! There are hundreds of industries that qualify for the credit as it is fact specific to your everyday activities and work projects.
Yes! Fortune 500 companies have been taking advantage of the credit for decades, and now with the recent changes, more small to medium sized businesses than ever before are claiming the credit. But even with the increase in claims, only 5% of companies that qualify for the R&D Tax Credit are taking the time to do so.
While the credit is available to businesses to take advantage of, the IRS isn’t simply handing out credits. UBOS/BIS has industry focused professionals, who understand and identify the key activities of your business that qualify. More often than not, companies who have claimed the credit on their own are not claiming the full value they are entitled under the tax code. It’s hard to stay abreast on all the changes within the credit, as it has changed more times in the last 5 years than in the previous 30.
After claiming the credit, do you still have tax liability? If so, then it’s worth having our industry experts take a second look as it is commonplace for us to find 3-4 times as much as previously claimed. Regardless, with something as important as your business and financial well-being, it would never hurt to take a second look to ensure your company is receiving all the full value you are entitled from the credit.
Absolutely. Since the changes in legislation and tax reform, the R&D Tax Credit remains one of the most valuable incentives offered by the U.S. government for businesses to remain competitive.
If you are a commercial building owner who has made improvements to your building, you may be eligible for a major reduction in your tax liability. In the past several years, both Congress and recent administrations have placed significant emphasis on initiatives.
You first need to know that for an energy-efficient building to qualify or partially qualify; it does not have to have grass growing on the roof or a windmill powering its electrical systems. As commercial buildings are responsible for 70% of rational energy usage, creating more energy-efficient buildings can offer rewards. In response to the nation’s energy consumption issues, Congress passed the Energy Policy Act of 2005, creating a federal incentive to reward the design and installation of upgraded systems in commercial and government-owned buildings.
The deduction is available to building owners and lessees who make energy-efficient improvements to their commercial buildings, including:
Our diverse UBOS staff is fully knowledgeable in the requirements of the 179D deduction. Our services are done in line with IRS standards, providing trusted and proven results.
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