Why The Government Needs to Get That R&D Tax Credit Renewed
Companies in Ohio may find themselves stuck in a financially difficult position shortly as there is no sign of the government completing the expected renewal of the tax credits as of yet. This is deeply frustrating for those Ohio companies who seek to offset some of their research and development costs.
A Matter of Time:
Whilst it is fully expected that the Treasury will again extend the availability of the tax credits as it has done every time the incentive has expired, there is no confirmation of when this might actually take place as of yet. This does have an effect on the accounting of companies in Ohio and around the US as a whole which may return figures that they were not expecting to. This poses companies with a large challenge when it comes to financial forecasts. The reduction in tax rates that eligible companies receive can account for a good percentage of their tax bill.
Understand the Effects:
It is important that Ohio based companies understand the impact that this could potentially have on their finances and be in a position to claim the tax credits as soon as they are renewed. Advice should be sought from experienced assessors who can give businesses the benefit of their knowledge. The best approach to taxation is always to keep it simple and concise. A good team of professionals such as those at Swanson Read will be able to guide you through the legislation and eligibility requirements allowing you to understand what is available to you and therefore the financial position of your business. This will allow you to plan better for your future.
Plans To Make It Permanent:
It has been suggested, by more than one President, that the R&D tax credits should be made into a permanent fixture by the Treasury. It has after all expired nine times so far in its thirty plus year existence and it has been renewed every time. However, the costs of making it permanent seem to be so high that the government is avoiding this option, preferring instead to keep to the renewal system that keeps businesses in the dark about their finances for long periods of time.
It is hard for any company to function when it is unsure of where it stands financially. It can affect all areas of its operations in the long term. Having the support of taxation professionals to provide the right advice at the right time is a must for any forward thinking company.