Texas’ Universities Earn Coveted Research Status
Texas’ mix of international appeal and Southern charm has seen the state constantly rank highly in business classifications. The lone star state boasts a broad business network, with Houston being home to the second largest concentration of Fortune 1000 companies in the country. According to Forbes, Houston is also among the 10 Best Cities for Young Entrepreneurs. Indeed, as the saying goes, everything is bigger in Texas.
Markedly, over the past 20 years, Texas has become an increasingly important part of the US economy. In 1995, it made up 6.5% of the total US GDP; by 2014 it was over 9%. In addition, notwithstanding Texas’ commitment to success, is the academia the state harvests.
To elaborate, four Texas universities — Texas Tech University, the University of North Texas, the University of Texas at Arlington and the University of Texas at Dallas — have achieved a monumental breakthrough in their pursuits to join the top tier of the nation’s colleges.
The Carnegie Classification of Institutions of Higher Education registered the universities among 115 schools designated in its highest ranking for research activity. The designation, often denoted as “Carnegie Tier One,” was formerly held only by four Texas schools — the University of Texas at Austin, Texas A&M University, Rice University and the University of Houston. The designation, apart from applauding research prominence, is also a sign that the universities are moving towards the state leaders’ goal of increasing the number of overall “tier one” universities in Texas.
Moreover, an opulent university research network fosters economic development by embedding the regions with technology, knowledge and talent. It is also important to note that companies are able to claim the research and development (R&D) tax credit for qualifying activities performed at universities. Typically, companies that engage in this type of research will receive a higher credit than they would if the project was done outside of a university. For instance, federal returns allow an additional 20% credit for R&D conducted through universities. Furthermore, the credit rates for Texas state credits returns double when working through universities.
Thus, Texas’ high calibre of research universities could certainly benefit the economy, companies and students. As noted above, the R&D tax credit emboldens companies to take on R&D projects that benefit their industry sector but are also suitable to academic research. Contact Swanson Reed today to find out more about the credit and if you qualify.