Documentation Required for Filing the R&D Tax Credit

The R&D tax credit, worth approximately $7 billion annually in recent years, saw 17,700 corporations claim $6.6 billion in R&D Tax Credits on their tax returns in 2005 alone. Indeed, the many economic benefits of the R&D tax credit are well documented – however, just how well do individual companies need to keep their documents? Ultimately, clear and concise documentation of a company’s R&D is vital in ensuring eligibility for the R&D tax credit. Appropriate documentation may require changes to the company’s recordkeeping processes because the burden of proof regarding all R&D expenses claimed is on the taxpayer. Therefore, the company must maintain documentation to illustrate nexus between qualifying research expenses and qualifying research activities.

In our latest video tutorial, we provide a snapshot of the documentation that is required for filing the R&D Tax Credit.

Watch on YouTube: https://www.youtube.com/watch?v=6APM2KfeK9s