In Florida, there is a research and development tax credit that all businesses can take advantage of. The credit was put into place to help businesses grow and expand their operations. Unfortunately, though, we see so many small and mid-sized businesses neglecting this resource. Maybe it’s because they don’t know it exists in the first place. Or if they do know of its existence, they assume they don’t qualify or it’s not worth their time to investigate further.
The fact of the matter is, though, that this is a huge opportunity for any and all businesses that invest in research and development. That’s why we’re going to explain everything you need to know about it.
In this article, we’re going to break down what the Florida r&d tax credit is. We’ll explain what the terms of it are and how much money your business can get back with proper filing. We’ll even explain what qualifies as research and development in Florida so you can get a better understanding of whether or not you stand to gain money back. We’ll finish by explaining how to get your R&D tax credit filed in the state of Florida to earn your money back on next years taxes!
What Is The Florida R&D Tax Credit?
The Research and Development Tax Credit was created by the Federal government to encourage businesses to invest in research and development. The credit is available to businesses of all sizes, but it’s often underutilized by small businesses in particular. Sometimes, they just don’t have the in-house resources to explore further. We’re here to help, though – more on that later.
How Does the Florida Research and Development Tax Credit Work?
So, how exactly does the Florida research and development tax credit work? Let’s break it down.
To put it simply, the credit is designed to reimburse businesses for a portion of their research and development costs. It’s essentially free money that your business can put back into its operations! Now – you aren’t going to get sent a check from the government. This is just a credit that can be utilized towards your tax liability.
What Are The Terms Of The Tax Credit In Florida?
The tax credit in Florida is available to businesses of all sizes. There is no minimum or maximum amount that you can spend on research and development in order to qualify. However, there are a few other things to keep in mind.
First and foremost, the credit can only be applied to research and development costs that have been incurred within the state of Florida. So – if your business has an office in California but conducted all of its research and development in Florida, you’re still eligible for the credit!
Secondly, the credit can only be applied to expenses that were incurred within the past five years. So – if you’ve been keeping meticulous records of your research and development spending over the past several years, you may be able to get credit for some of those older expenses.
Finally, the credit is non-refundable. This means that it can only be used to offset your tax liability. It cannot be refunded to you in the form of a check or direct deposit.
How Much Can You Get Back Through The Tax Credit In Florida?
This will largely depend on the size of your business and how much you’ve invested in research and development.
To give you a better idea, let’s say that your business spends $100,000 on qualified research and development costs. If your business falls into the “small business” category, you would be eligible for a credit of up to $13,500! That’s a pretty significant chunk of change that can be put back into your business.
Of course, this is just an example – actual numbers will vary based on individual circumstances. But we hope this gives you a better idea of how beneficial the credit can be!
What Qualifies As Research and Development in Florida?
One of the most common questions we get is “what exactly Qualifies as research and development in Florida?” To be honest, it’s a pretty broad term. The IRS defines research and development activities as “activities undertaken for the purpose of discovering information that is technological in nature and that has the potential for application in new or improved products, processes, or software.” This includes (but is not limited to) activities like:
- Developing new products or improving existing ones
- Developing new uses for existing products
- Developing new processes or improving existing ones
- Identifying market trends and customer needs
- Determining the feasibility of a new product or process
You may be thinking – I didn’t really conduct any serious research and development. however, you may have spent money on qualifying activities without even knowing it. That’s why it’s always worth it to explore a bit further with a free consultation here at Tier Group. We’ll talk more about that towards the end. First, let’s discuss how to file for your credit if you believe you qualify.
How To Get Your Florida R&D Tax Credit
Now that we’ve answered some of the most common questions about the credit, it’s time to get into how you can file for it. Filing for the credit is not as complicated as you might think. You simply need to fill out Form 6765 and submit it along with your business’ tax return.
If you’re not sure whether or not your business qualifies, we recommend speaking with a tax professional. They will be able to help you determine if you’re eligible and advise you on the best way to file. Or, let us help!
Let Us Help You Get All You’re Owed Through The Florida R&D Tax Credit!
Navigating the process of getting your tax credit for R&D expenditures isn’t easy. That’s where we come in. At the Tier Group, we help small and mid-sized businesses gain access to the same tax credits and incentives that the big corporations take advantage of. No matter your industry, no matter your business size, no matter your location – we’re excited to help you. Here are some industries we specialize in:
- Construction R&D Tax Credits
- Software Development Tax Credits
- R&D Tax Credits For Dentists
- Food and Beverage Tax Credits
- Manufacturing Tax Credits
- Engineering Tax Credits
The best part? It starts with a free consultation! Simply fill out this form so we can get the process underway. We’ll then pair you up with an in-network tax professional to see exactly which credits you qualify for – and how much you stand to gain. With an average recovery amount of $104k, this is not something you should take lightly. Let’s get started!