Specialty Tax Services

TPR Compliance Services

The Department of Treasury issued their final treasury regulations governing the proper tax treatment for repair and maintenance expenditures (a.k.a, Tangible Property Regulations or “TPR Compliance Services”) on September 13, 2013. The final treasury regulations replace the temporary regulations previously issued in December, 2011. These final treasury regulations are meant to provide further clarity and reduce controversy over the determination of whether an expenditure may be currently deducted as a repair under I.R.C. § 162(a) or must be capitalized under I.R.C. § 263(a).

TPR Compliance is applicable to businesses in all industries that acquire, produce, replace, or improve tangible property. Application of the new repair regulations requires an in-depth understanding of various tax cases, circumstances that must be met, and the regulations themselves.

Contact us today for a complimentary consultation to discuss your TPR Compliance opportunity, and to identify and claim your missed deductions—including abandonment deductions and partial dispositions. We welcome the opportunity to help you stay in compliance with the new repair and maintenance regulations.

179D Energy Tax Deductions

The I.R.C. § 179D Energy Tax Deduction for a Building’s Energy Efficiency was significantly revamped through the PATH Act, which also extended the incentive over a 2-year period (e.g., retroactively to cover 2015 and prospectively to cover 2016).

The most sweeping change is in connection with the revised qualifying building energy code standards.  The standards for qualification have been increased from ASHRAE Standard 90.1-2001 to ASHRAE Standard 90.1-2007 for properties placed in service after December 31, 2015. The tax savings can be up to $1.80 per square foot for the installation of energy-efficient lighting, energy-efficient HVAC systems, or energy-efficient building envelope systems in new or existing buildings.

Building owners who place qualifying property in service can enjoy significant cost recovery of those improvements through an I.R.C. §179D certification. For designers of energy efficient systems installed in government-owned buildings, there is also a potential tax benefit of up to $1.80 per square foot, which is taken as a deduction against income.

The I.R.C. §179D Energy Tax Deduction is presently under review for extension or permanency. The expectation is that the present standards will remain and will be made permanent sometime this year.

Contact us today for a complimentary consultation to discuss your I.R.C. §179D Energy Tax Deduction opportunity.

Research & Development Tax Credits

Research & Development Tax Credits can apply to virtually any industry that conducts qualified research and development including:

  • Life Sciences (Pharmaceuticals, Bio-Technology, and Medical Devices)
  • Food Science and Bio-Flavoring
  • Green Energy, Fuel Cells, and Solar Technology
  • Chemicals
  • Architectural, Engineering, and Design-Build Contractors
  • Aerospace and Defense (Commercial and Military)
  • Software and Electronics
  • Semiconductors
  • Financial Services Software Development
  • Transportation (e.g., Airlines, Automotive, Rail,)
  • Utilities.

The New & Improved R&D Tax Credit Program

The Protecting Americans from Tax Hikes Act of 2015 (PATH Act) significantly enhanced the R&D Tax Credit Program (RTC) by making the RTC a permanent tax incentive and considerably updated the program to:

  • Permit eligible “Small Businesses” ($50 million or less in gross receipts) to claim the RTC against the Alternative Minimum Tax (AMT) for tax years beginning on or after January 1, 2016
  • Permit eligible “Start-Up Companies” (less than $5 million in gross receipts and earning revenue for less than 5 years) to claim up to $250,000 of the RTC against the company’s federal payroll tax for tax years beginning on or after January 1, 2016.

Take 3 Simple Steps to Offset Payroll Tax with the RTC

  • File Form 6765entitled “Credit for Increasing Research Activities” so companies can make an annual election to specify the amount of RTCs that will be applied to the employer portion of Social Security tax
  • File Form 8974entitled “Qualified Small Business Payroll Tax Credit for Increasing Research Activities” to report the amount of RTCs elected on Form 6765 to offset Social Security tax and the form will be filed with Form 941 each quarter that the credit is applied to the Social Security tax liability
  • FileForm 941 entitled “Employers Federal Quarterly Tax Return” to be able to include the amount reported on Form 8974 each quarter.

Contact us today for a complimentary consultation to discuss your R&D Tax Credit opportunity.