Pay Your Payroll Tax With R&D Credits
YoungUpstarts
MARCH 6, 2017
by Evan Stephens, Senior Tax Manager at Sensiba San Filippo and Carlos Freitas, Director with Hull & Knarr LLP. Starting in 2016, Research and Development (R&D) tax credits can be used to offset payroll taxes. Previously, these credits could only be used to offset income taxes. Since many start-ups produce little to no profit in the first few years, there was no income tax for the R&D credits to offset, and therefore, no opportunity to use the research tax credit.
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