2/26/2024 Update: Potential Changes to R&D Tax Credit

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I wanted to reach out personally to keep you updated on the latest developments regarding the R&D Tax Credit, a key incentive for innovative businesses like yours. On January 31, 2024, the House of Representatives passed the Tax Relief for American Families and Workers Act of 2024 (H.R. 7024). This bill includes a provision with the potential to significantly enhance the benefits of the R&D Tax Credit.

What this Means for Your Business:

• Potential Immediate Deductibility: If the Senate approves, domestic R&D expenses incurred from 2022 onwards might again become eligible for immediate deduction in the year they are incurred. This would be a significant shift from the current 5-year amortization requirement.
• Retroactivity: There's a possibility that this change, if it becomes law, could be applied retroactively. This would offer substantial tax benefits for eligible R&D activities undertaken since 2022.
• Focus on Domestic R&D: Please note, this potential change applies specifically to research and development conducted within the United States.

Note: Currently, the bill is being held up in the Senate. 

MTRS is Here to Help

Navigating tax law changes can be complex, but we're committed to making this process as clear and beneficial for you as possible. Whether it means revisiting past R&D activities or optimizing your strategies for the future, we're here to provide guidance and ensure you fully leverage the potential advantages within the changing tax landscape.

Please don't hesitate to contact us for a personalized discussion about your specific R&D activities. Email info@mtrsnow.com, call (800) 571-9226, or reach out on social via @MTRSNow.

Stay innovative, 

Danielle Michel, CPA

President and Founder

Manufacturing Tax Recovery Services