How COVID-19 could impact your R&D tax credit

As the world continues to deal with the effects of COVID-19, the United States has had to pass various rounds of new legislation to help Americans and their businesses. To encourage the growth of the US economy, legislators may look to make changes in an effort to expand the R&D tax credit and thus help more people.

According to a Forbes article, current proposals for changes to the credit include:

• Doubling the R&D tax credit
• Allowing businesses to monetize their R&D tax credit immediately
• Expanding the R&D tax credit for domestic manufacturing
• Increasing the refundable R&D credit for startups

The goal here is for businesses to have more money in their pockets to continue investing and spending as we move ahead. With many of the changes related to the pandemic and lockdowns, businesses should take this time to follow any updates in relation to the R&D tax credit, and any other credits they may qualify for.

Some senators have already been pushing for additional updates to this tax credit, including Delaware Senator Chris Coons and his proposal of the FORWARD Act. This act aims to further the U.S. recovery with American research and development pursuits.

As of this writing, the bill has been introduced to the Senate but no changes have been made.

Be sure to follow our blog for the latest updates to ensure you have all the information you need regarding R&D credits come tax time.