For many years, the research credit (also commonly referred to as the “research and development” or “research and experimentation” credit) has provided an incentive for businesses to increase their investments in research. But the credit expired at the end of 2011.

The American Taxpayer Relief Act of 2012 (ATRA) extends the credit to 2012 and 2013. You can use the credit for virtually any research that benefits your business. Wages for researchers, the cost of research supplies and the cost of computer licensing for research purposes are all expenses that may qualify for the credit.

The credit is generally equal to a portion of qualified research expenses. It’s complicated to calculate, but the tax savings can be substantial. If you think you may qualify, please contact us for assistance. There’s still time to claim the credit for 2012.

Image courtesy of www.freedigitalphotos.net.