Las Vegas R&D Tax Credits

Sustainable business growth requires innovation, and innovation requires extensive research and development. But did you know you can stay ahead of your competition and save money by claiming applicable research & development tax credits?

The R & D tax credit was established in 1981. It allows businesses to save while they are experimenting and innovating. The R&D credit reduces federal taxable income. This means your business receives a dollar-for-dollar tax credit and can still deduct expenses related to research and development endeavors. However, you must closely track and record all qualified research expenses (QREs). Some key benefits of R & D tax credits include:

• Reduces the company’s tax liability
• Increases cash flow and market value
• Increases earnings-per-share
• Lowers effective tax rate
• Allows the business to keep more profit
• Mitigates alternative minimum tax, Federal Insurance Contributions Act (FICA) payroll tax, etc.

States have different rules for their own R & D tax credits, but the “Protecting Americans from Tax Hikes Act,” or the “PATH Act, made federal R & D credits a permanent option. When you team up with the Haynie & Company CPA firm, you’ll benefit from our extensive experience calculating R & D tax credit for small businesses and large businesses all across the country. It is our goal to save you money and uncover every potential tax benefit you and your business can take advantage of!

For more information about R & D tax credits in Las Vegas, read on below. To speak with our R & D tax credit specialists about this tax break and your eligibility, please reach out to our Las Vegas CPA firm.

Is R&D Tax Credit Available in Las Vegas, Nevada?

Unfortunately, the state of Nevada does not have research and development credit. However, as a Las Vegas based company, you may still be eligible for the federal R & D credit. With help from Haynie, it’s simple to save! Reach out to the R & D tax credit specialists at Haynie & Company CPA firm now for more expert guidance.

Who Can Claim Research & Development Tax Credit in Nevada?

Although there is no Nevada research & development tax credit, there are federal options available for you to explore. Any company engaging in activities to develop or improve its products, processes, software, or formulas in a manner that requires technical research and experimentation might qualify for the R & D credit.

Still, claiming these tax credits is a complex process. Las Vegas companies attempting to claim R&D credit on a federal level need to provide evidence (like dated receipts and invoices, contracts, progress reports, lab results, etc.) for all qualified research expenses. It is important for all evidence to be dated, since you must prove the activities occurred during the appropriate fiscal year(s). If you do not keep appropriate records and still try to claim an R & D tax credit, you may be audited.

Furthermore, R & D tax credit eligibility requires hard science. Most companies engaging in these activities within the United States can claim the R & D credit:

• Testing products
• Employing engineers
• Investing in data science and data analysis
• Outsourcing product research

Las Vegas businesses can claim federal R & D credit by filing IRS Form 6765, Credit for Increasing Research Activities. However, according to the Internal Revenue Code (IRC) Section 41(d) and Section 174, all of this qualified research activity must also pass this four-part test:

1. There is a qualified purpose (i.e., developing something new or improving upon something that already exists)
2. You are experimenting and evaluating possible alternatives
3. You are relying on hard sciences to back up your experiments
4. You aim to eliminate uncertainty during the process

For professional help calculating and claiming your Las Vegas R&D tax credits, contact the tax professionals at Haynie & Company.

With an R & D tax credit, IRS lets businesses claim 100% of the W2 wages for employees who spent “substantially all” (meaning 80% or more) of their time on qualified research activities. This does not apply to contractors.

The following costs may qualify for an R & D tax credit claim:

• Wages
• Supplies
• Contractors
• Patent costs
• Computer science costs and software development

Note: As of 2022, the Tax Cuts and Jobs Act requires businesses to amortize their R & D costs over the course of five years rather than deducting them immediately.

Understanding which expenses qualify for an R & D credit—and collecting the documentation to back them up—is complicated for many small businesses. As R & D tax credit specialists, Haynie & Company helps you calculate federal tax credit by analyzing qualified research expenditures and organizing vital documentation. It is our goal to save you money and uncover every potential tax benefit you and your business are entitled to. We can even carry the credit forward up to 20 years, and we can perform look-back studies to find unclaimed credits for open tax years (generally 3-4 years.)

The “Startup Provision”

To offset payroll taxes, startups in Las Vegas could qualify for up to $1.25 million (or $250,000 each year for up to five years) in federal R & D tax credit. In order to be eligible, the start-up companies must not exceed the following:

• $5 million in gross receipts for the credit year
• 5 years of gross receipts

For Help with Payroll Taxes, R & D Tax Credits, and More, Contact Haynie & Company CPA Firm in Las Vegas, NV

Research and development tax credits exist to encourage innovation in a broad variety of industries—but less than one-third of companies that qualify for R & D credits actually apply for them. As a Las Vegas business owner, you must stay up-to-date on state and federal income tax liability and payroll tax liability so you don’t miss out on important opportunities and credits.

If you’re considering applying for the R&D tax credit, here’s how we help:

• Identifying qualifying activities
• Tracking expenses and organizing receipts
• Documenting all related costs
• Meeting important deadlines
• Federal audit support
• Preparing any required tax filings, including how to file Form 6765
• Performing look-back studies to find unclaimed credits for open tax years

When it comes to the future of your business, don’t take a gamble. With audit defense, income tax preparation, financial planning, and proactive insights that help your business grow to new heights, Haynie & Company is the Las Vegas CPA firm you can trust. Decades of experience and a thorough understanding of internal revenue service code and tax liability mean we leave no stone unturned in our quest to save you money.

To find out if you qualify for R&D tax credits and learn how to leverage every possible tax break available to you and your business, contact Haynie & Company’s dedicated tax professionals.