Research Tax Credit

The 2010 Tax Relief Act extended the research tax credit, which includes the basic and energy consortium research tax credit, for two years. The research credit was extended retroactively for 2010; thus, expenses incurred for research and experimentation in 2010 qualify for the credit. Taxpayers who have already filed tax returns for tax year 2010 [...]

In Technical Advice Memorandum 201034017 (Aug. 27, 2010), the parent of a consolidated group purchased the stock of a target company that was itself a parent of a consolidated group. The stock sale did not qualify as a tax-free transaction under I.R.C. §§ 355 or 368. The target company’s consolidated group was terminated because of [...]

The Bayer Corp. & Subs v. United States, Civil Action Nos. 08-693, 09-351 (W.D. PA 2010), court case shows how important it is to place information and security controls on information gathered when preparing a research tax credit.

// The United States v. Goertz, No. A-09-CA-179 LY (W.D. Tex. 2010) case highlights why defending R&D tax credits on audit is often frustrating for taxpayers and the government alike. The short answer, is that it comes down to documentation. The court case does not say why the taxpayer’s research tax credit claim was denied. [...]