R&D Tax Credit Assistance

An important route for medtech and biotech companies to get non-dilutive capital is the Research & Development Tax Credit.  This credit has been around since 1981, and has gone through many changes.  In order to qualify, a business has to be performing activities that are new or improved to itself, not to the world, so a patent, which was basically necessary years ago, is no longer the case.   This credit has gone through many changes recently, and if you are a start-up, less than $5 Million in revenue per year for no more than the last five years, the R&D credit can offset payroll tax.  Otherwise, the R&D tax credit is a dollar for dollar savings against income tax.  The credit can be claimed for the current tax year, and the prior three tax years, so if you claim a credit in 2019 for $100,000, this could potentially be a $400,000 credit.  Many states also offer some form of the R&D tax credit as well, so a business can benefit at both the state and federal level.

 

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