An overlooked source of cash for New York manufacturers is the Research and Development (R&D) tax credit. This incentive helps companies to grow by reducing its tax liability for qualified R&D expenditures.
Most manufacturers are unaware that their efforts in designing and improving products and processes qualify as R&D, and may make them eligible for tax credits for expenditures associated with these activities. R&D credits may be applied to taxes due or to future tax liability, and they may be retroactive for three years in addition to the current year and carry forward for twenty years! These credits can additionally be used to reinvest in the company.
Qualifying costs include:
- Tasks performed by Engineering, Executive Leadership, Legal, Sales Engineers, Operations, and IT
- Cost of supplies
- Third-party contractor fees
We’ll be hosting a webinar in the the first quarter of 2021. In the meantime if you’d like more information, please contact us.