ARCHITECTURE

The R&D Tax Credit for architecture companies

Many architectural design companies are great candidates for the R&D tax credit, as they specialize in the design of buildings from a functional and aesthetic perspective -- especially those focused on commercial work.

Furthermore, there are additional tax credits available to architecture companies that can be combined with the R&D tax credit in some instances.

How can the R&D tax credit be used?

There are various ways that the R&D tax credit can be utilized.

FEDERAL/STATE TAX LIABILITY

Reduce your federal and/or state tax liability in current years, and receive refunds for past years.

FICA PAYROLL TAX LIABILITY

Reduce your FICA payroll tax liability (up to $250,000 per year). Requirements:
- Less than five years old since formation.
- Less than $5 million in revenue per year (includes companies that are pre-revenue).

CARRY IT FORWARD

Unused tax credits can be carried forward for up to 20 years, whether or not your company has achieved profitability.

ALTERNATIVE MINIMUM TAX (AMT)

Apply the tax credits against Alternative Minimum Tax (AMT) beginning January 1, 2016.

Approved R&D activities

Most of the work activity that happens inside of an architecture company is “R&D qualified”, and can lead to significant R&D tax credits.

Designing building facades, systems and site plans.

Experimentation with new/alternative materials.

Use of computer-aided design software programs.

Design and development of LEED, energy-efficient or “green” alternatives.

Credit-generating expenses

Your R&D tax credit is made up of Qualified Research Expenditures (QRE’s). These comes from a variety of sources, including wages, supplies and third-parties.

W2 wages of individuals performing, supervising, or assisting R&D activities

65% of payments to third-party consultants,
contractors, and/or companies

Supplies/materials used in qualified R&D activities

Partnership earnings and/or Schedule C profits

Credit-generating expenses

Your R&D tax credit is made up of Qualified Research Expenditures (QRE’s). These comes from a variety of sources, including wages, supplies and third-parties.

ARCHITECTURE

The R&D Tax Credit for architecture companies

How can the R&D tax credit be used?

FEDERAL/STATE TAX LIABILITY

FICA PAYROLL TAX LIABILITY

CARRY IT FORWARD

ALTERNATIVE MINIMUM TAX (AMT)

Approved R&D activities

Credit-generating expenses

Credit-generating expenses

Get in touch with our team.

480.948.1063

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