Why tech companies often miss out on the R&D tax credit

The Research & Development Tax Credit, often simplified to the “R&D Tax Credit”, offers an opportunity for small and large business owners alike to substantially reduce their tax liabilities. From robotics and machine learning to AI, virtual reality, there are countless areas of research applicable for this credit. But year after year, tech companies fail to recognize their eligibility.

So, why do so many companies miss out on valuable tax credits?

Companies are unaware.

A huge reason the R&D tax credit goes unnoticed is because many small tech startups simply aren’t aware of it. If they do know of the credit, these business owners may assume only large corporations and tech enterprises are eligible. That’s not the case. Your computer business doesn’t have to create the next disruptive, mindblowing tech system to receive an R&D tax credit.

Keep in mind, the R&D tax credit is available to any business that “attempts to develop new, improved, or technologically advanced products or trade processes.” Additionally, the credit may be available to your tech company if you’ve had any employees attend technical meetings or improve existing internal practices and processes.

Many small tech companies don’t have the luxury of a finance team.

This can hinder the company’s ability to dedicate time and resources to discovering tax credits as well. No matter the size of your tech company, don’t count yourself out of the R&D tax credit.

No employees or revenue.

Additionally, tech companies often miss out on the R&D tax credit because they haven’t employed anyone or earned any revenue yet. So, they assume they are ineligible.

This credit is more lenient than you think! Click here to learn more and see if you qualify for the R&D Tax Credit today.