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Paradigm Partners Newsletter
July, 2009 |
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Greetings
Dear :
The purpose of our newsletter is to keep you informed and up-to-date on the latest regarding R&D Tax Credits, Cost Segregation, other tax related issues, Business Development and Personal Development.
If you find the Newsletter helpful, you may want to forward it to a friend. Just click below.
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Paradigm Partners Expands Services By Acquiring Federal Hiring Tax Credits Consulting Firm
In June, Paradigm Partners acquired a Boston-based consulting group that specializes in Federal and State Hiring Tax Credits.
The firm specializes in the following areas:
- WOTC (Work Opportunity Tax Credit)
- Federal HUD Zones
- Indian Tax Credit
- State Hiring Incentives
Brian Cameron, EVP of Business Development for Paradigm, relates "We saw an opportunity in the credits and incentives market to expand our own services. The acquisition would provide an opportunity to assist our existing customers with additional tax incentives and attract new clients and win some significant market share from the major players in the federal hiring credits arena."
Paradigm has created a FREE Introductory Webinar on Federal Hiring Tax Credits to introduce these incentives to our prospects and clients and it is worth one hour of CPE Credit.
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2005 R&D Tax Credit May Be Lost
Filing Deadlines Approaching
As you know you can go back 3 open tax years and capture the R&D Tax Credit.
If a company wants to capture their credit for 2005, they can file an amended return 3 years from the date they filed their returns for 2005. Once that date is passed; you have lost the credit forever.
So if a company filed an extension in 2005, they may still have to time conduct a study and amend their 2005 returns.
In addition, those companies that want to use the credit for 2008 and have filed an extension, it is beneficial to include the credits in the original return and not file an amended return. In our experience, there is a smaller chance of being audited if the credit is taken on an original return than an amended return.
If we are dealing with S Corps, the deadlines would be related to the individual shareholders.
Do not hesitate to contact us if you have any questions. |
R&D Tax Credit Audits Wreaking Havoc with Manufacturers
Prepared by
Karim Solanji, J.D., Director
Mark Lauber, VP of Marketing
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Since 2001, there have been two significant modifications concerning the Research & Development (R&D) Tax Credit. Although very positive, they have elevated the required expertise with regards to the preparation of the supporting documentation and more importantly, the required expertise in the event of an R&D Audit.
Initially mostly large-cap companies were able to take advantage of the credit due to their ability to invest in an IT infrastructure capable of documenting their activities and hours on a real-time basis. Realizing that a majority of innovation in the U.S. was in fact transpiring from small to mid-size firms, Congress in 2001 liberalized the statutory requirements to enable small and mid-size companies (SMBs) across the country to take advantage of the R&D benefits.
Specifically, the new regulations provided that companies were no longer required to maintain precise timesheets documenting every hour an employee spent conducting qualified R&D activities. Furthermore, the research no longer had to result in a product that was new to the industry; instead, the resulting product or process simply had to be new to the company that developed it.
Due to the relaxation of the strict rules and the broadening of the definition of what it means to perform a qualifying activity in 2001, there has been a flood of claims into the IRS. Naturally, and given the large size of the credit, the IRS has discovered that numerous claims filed by companies themselves or through the help of "engineering" firms have been wholly deficient in their documentation and substantiation of the claims they are making.
This led to the second significant event. In April 2007, the IRS designated the R&D Tax Credit as a "Tier I" audit issue.
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Valant & Company's Solid Rules
Can Ensure Success in Life, Business
Editor's Note: Today we present the fourth installment in a special inspirational series from business performance improvement expert Laurence B. Valant, who specializes in growing profits for accounting firms and general business. Larry has been a frequent contributor to our newsletter, and again today, we feature excerpts from his new book, Stop Breaking These Rules! 100 Hard-Hitting Truths for Business Integrity and Performance. If you want more information or would like to order a copy of the wonderful new book, please visit www.valantco.com. 18 - Anger is a manifestation of fear.
If I am afraid, for whatever reason, a possible manifestation of that fear is anger. My anger may be caused by someone's actions that affect me or someone I care about, an injustice, an unwelcome outcome or my own actions - or lack thereof. But the cause doesn't really matter; if I see a different result than I expected, it is entirely possible for me to react with anger.
I might also talk myself into anger. I may take action, and while waiting for the results of those actions, convince myself that the outcome will not be as I expect - even though I do not yet know what that outcome will be.
In these cases, I am using my anger to deal with my uncertainty, which upon close examination is an unhealthy need for control. So my anger is my way of covering up for my lack of control of outcomes and results. In my experience, such anger has never served me well; rather, it has served to create issues and problems that did not need to have existed.
When I can learn to accept outcomes which are different from those I anticipate, I am on the path of personal growth and effectiveness.
Read the Rest of the Article
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I hope you have benefited from our Newsletter. Do not hesitate to contact me if you have any questions about what you heard or read in this Newsletter.
Sincerely,
Mark Lauber
VP of Marketing
Paradigm Partners 281-558-1700 X-105
www.ParadigmLP.com |
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