Can I Claim R&D Tax Credits in Virginia?
Yes, you can claim R&D tax credits in Virginia. The state offers a research and development tax credit program known as the Research and Development Expenses Tax Credit.
.svg)
The Research and Development Tax Credit (R&D) is available to all businesses conducting R&D in the United States, regardless of size. This tax credit applies to a variety of industries and companies beyond just scientists and research labs. The R&D tax credit was introduced to encourage research and development efforts in the United States. Over the years, an increasing number of companies are capitalizing on this tax credit. Moreover, the Protecting Americans from Tax Hikes (PATH) Act of 2015 made the R&D tax credit a permanent fixture, benefiting not only established companies but also startups.
What are the Potential Benefits of the R&D Tax Credit?
Eligible businesses can save a substantial amount of money by taking advantage of R&D tax credits. These benefits include:
- Increasing Cash Flow
- Federal and State Dollar-for-Dollar Income Tax Reduction
- Claim Credits for Open Tax Years Going Back 3-4 Years
- Reducing Your Tax Rate
$1.6 BILLION
Who Can Claim the R&D Tax Credit?
R&D tax credits are not limited to those in lab coats or creators of top-notch products. They are actually applicable to a wide range of companies across various industries.
It may come as a surprise, but companies of all sizes can qualify for Research and Development (R&D) Tax Credits as long as they meet the federal government's criteria for innovative activities. Unfortunately, many businesses are unaware of their eligibility and are missing out on substantial federal and state tax credits. Don't leave money on the table – take advantage of these valuable incentives.
The activities that qualify for the R&D tax credit are the same ones driving growth in your business.
- Developed new products
- Improved existing products
- Developed software for internal or external use
- Improved manufacturing processes
“
The activities that qualify for the Virginia R&D tax credit are the same ones driving growth in your business.
”
10,700
How Do I Claim the R&D Tax Credit?
Companies can often claim 7-10% of their eligible expenses as a federal R&D tax credit. For instance, a software developer, engineer, or lab technician earning $100,000 per year could potentially save up to $10,000 in taxes.
Your company's research activities can be supported by qualifying expenses such as employee compensation, materials, and contracted services. To document these expenses, you can use payroll records, financial records that show supply or contract research expenses, and vendor invoices.