for the R&D Tax Credit
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R&D Tax Credit
PRODUCTS AND PROCESSES
R&D Tax Credits for the Foundry Industry
Refunds are available for companies performing research within the Foundry Industry. The research credit provides dollar-for-dollar cash savings each year for companies performing activities related to the development of new or improved products and processes. These benefits could provide much needed cash to hire additional employees, increase R&D, expand production facilities, etc.
Many companies involved with foundries are unaware that their efforts within designing and developing their products can yield a large amount of research credits. Examples of R&D activities related to the industry as well as potentially qualifying job titles are listed below.
Examples of Qualifying R&D Activities
- Designing for tight tolerances new to the company
- Designing for harsh climates
- Improving the metal casting process including melting, coating and heat treatment; casting, molding and welding techniques; pollution control, waste and furnace charging systems; new gating and riser designs; reduce or recycling excess coating
- New product development including improving strength, stress tolerances, durability or service life
- New technologies related to filtration processes, pouring techniques, temperature control and measurement, monitoring metallurgical process performance, flow control, mold and coating materials, binder materials
Potentially Qualifying R&D Job Titles
- Computer Numerically Controlled (CNC) Programmers
- Foundry Process Control Technicians
- Foundry Workers
- Heat Treatment Supervisors
- Manufacturing Engineers, Supervisors
- Melt Deck Supervisors
- Pattern Makers
For tax years beginning after December 31, 2015, eligible small businesses (those with $50 million or less of gross receipts) may claim the research credit against AMT liability.
Up to $250,000 in Payroll Tax
Qualified start-up companies may elect to use up to $250,000 of the research credit against payroll taxes. Treasury Regulations have substantially broadened the range of taxpayers who are eligible for the credit. Start-ups to publicly traded businesses who were previously unable to realize a benefit from this lucrative tax credit should reassess their eligibility.
Estimate Your Benefits with our FREE Calculators
Use our calculators for an estimate of state and federal R&D tax credit benefits or to determine if you can offset payroll tax using the R&D tax credit. It's easy to use and free. If at any time you have questions, contact us. We are here to help you realize your maximum tax benefit.
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Research and Development Tax Credit Insights
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Many companies are hesitant to take advantage of the Research & Development (R&D) Tax Credit for fear of a possible IRS audit. In our first 2 minute video, former IRS engineering officials discuss how many companies can avoid IRS scrutiny by properly describing their research activities. KBKG’s IRS Audit Defense videos give a better understanding … Read More
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As featured in Accounting Today Internal Revenue Service examinations of the research tax credit can burden both the client and the IRS. Throughout most of its decades-long history, research credit audits have exposed areas of misunderstanding and, in many circumstances, led to major disagreements. There is little “bright line” guidance, and each examiner must consider … Read More
The Commonwealth of Virginia made key changes and extended the income tax credit for conducting qualified research and development in Virginia. Key changes include: A three (3) year extension of the credit from tax years beginning before January 1, 2022 to tax years beginning before January 1, 2025 Beginning January 1, 2021, an increase in … Read More