Can I Claim R&D Tax Credits in Wisconsin?
Yes, you can claim R&D tax credits in Wisconsin. The state offers a research and development tax credit program known as The Basic Research Credit.
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The Research and Development Tax Credit (R&D) is a tax benefit that supports businesses of all sizes engaging in research and development activities in the United States. This tax credit is not limited to scientists and research labs; it can be utilized by a diverse range of businesses and industries. The R&D tax credit encourages US research and development efforts. It has seen increasing participation from companies every year. Furthermore, the 2015 PATH Act made this credit permanent and expanded it to include startups.
What are the Potential Benefits of the R&D Tax Credit?
Qualifying companies can save costs through 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?
There was a widespread misunderstanding that R&D tax credits were solely for individuals in lab coats or those responsible for groundbreaking products. However, it's essential to recognize that R&D credits extend further and encompass more than most people realize.
Companies of all sizes and industries can claim Research and Development (R&D) Tax Credits from the federal government. Unfortunately, many companies are unaware that they qualify for these credits and are leaving money on the table. Don't miss out on significant federal and state R&D tax credits that could benefit your business.
The activities eligible for the R&D tax credit are the very activities fueling your business's growth.
- Developed new products
- Improved existing products
- Developed software for internal or external use
- Improved manufacturing processes
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The activities that qualify for the Wisconsin R&D tax credit are the same ones driving growth in your business.
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10,700
How Do I Claim the R&D Tax Credit?
Typically, companies can claim a federal R&D tax credit equal to 7-10% of their eligible expenses. For instance, a software developer, engineer, or lab technician earning a $100,000 annual W2 salary could potentially save up to $10,000 in taxes.
Qualifying expenses for research activities in your company usually consist of employee compensation, materials, and contracted services. To back up these expenses, you can provide various documents such as payroll records, financial records displaying supply or contract research expenses, and vendor invoices.