Senior-Focused Tech Startups Can Load Savings with R&D Tax Credits

Written by Corporate Tax Incentives. Updated Jan 5, 2024.

What's the trend entering 2024? 

For many, it will be the continuation of technological innovations and upgrades to grow their respective industries. However, which industries are benefiting? On the whole, senior living operators are continuing to spend on technology and plan to further do so this year. The large majority of respondents to this survey plan to increase their tech budgets significantly in 2024.

While investing time and money into the increase in technology, the introduction of the Research & Development (R&D) tax credit may become essential to companies developing and creating new or updated technology for senior living operators.

Read More

Substantiation, Not Shortcuts

Written by Taylor Melton. Updated Sep 8, 2023.

The US Tax Court (the Court) recently issued a decision, holding that the Petitioners were not entitled to a research and development (R&D) credit under Internal Revenue Code (I.R.C.) § 41. Petitioners in the consolidated cases are shareholders in an S-Corporation, Catalytic Products International, Inc. (“CPI” or “the Company”), that designs and supplies air pollution control systems. CPI claimed a research credit under I.R.C. § 41 in connection with 19 projects, based on both employee wage expenses and supply expenses incurred in connection with the projects and systems the Company supplied. The Internal Revenue Service (IRS) issued a notice of deficiency related to the credit claim, and the Petitioners subsequently filed a timely petition with the Tax Court.

Read More

The Golden Age of the 179D Energy Efficient Building Deduction

Written by Richard Juneau, PE. Updated Aug 10, 2023.

The whole intent of Section 179D is to provide an incentive in the form of a tax deduction to building owners who install energy-efficient lighting, windows & doors, roofing, insulation, and Heating, Ventilation, and Air Conditioning/Hot Water (HVAC/HW) equipment in new buildings or retrofit projects. All buildings in the US are eligible for the 179D deduction, except housing units less than 4 stories above ground. The Inflation Reduction Act of 2022 (IRA) affected section 179D in several ways, and the next three years will present a golden opportunity for the owners and designers of energy-efficient commercial building property (EECBP).

Read More

Maximizing Tax Benefits with Cost Segregation: Notes for Meeting IRS Guidance

Written by Bill Mark. Updated Aug 7, 2023.

When it comes to commercial real estate investments, one aspect that often goes unnoticed is the potential tax benefit through cost segregation. This powerful tax planning tool allows property owners to accelerate depreciation deductions, resulting in significant savings. In this blog, we will explore the concept of cost segregation, its benefits for companies, and the available guidance provided by the Internal Revenue Service (IRS). We will also delve into why the IRS requires engineers to perform cost segregation studies and its implications for accuracy and compliance.

Read More

CTI's 5-Minute Guide to 179D

Written by Richard Juneau, PE. Updated Jul 31, 2023.

Since its creation in the Energy Policy Act of 2005, the Section 179D Energy Efficient Commercial Building deduction has provided an incentive for taxpayers to install energy-efficient commercial building property (EECBP) as part of the building envelope, lighting, and/or Heating, Ventilation and Air Conditioning/Hot Water (HVAC/HW) systems. EECBP comprises light fixtures, switches, HVAC equipment, automated controls, ducts, water heating, windows, doors, insulation, and roofing. EECBP may be installed in a new building, or it may be part of a retrofit project for an existing building. Buildings that qualify for 179D include almost all buildings in the United States except residential housing less than four stories above ground. That’s a lot of eligible buildings!

Read More

Important Employee Retention Credit Filing Deadlines for 2024 and Beyond

Written by Katherine Johnson, Esq. Updated Jul 28, 2023.

With the expansion of the Employee Retention Credit (ERC), there has been a flurry of amended returns for companies that previously were unaware of the credit or were ineligible under the initial statute. As more and more companies become educated on the credit and their eligibility, there has been confusion over the timeline to submit ERC claims.

Read More

Unlocking Opportunities: The Work Opportunity Tax Credit for Veterans and Ex-Felons

Written by Rachel Zarate Brouwer. Updated Jul 25, 2023.

You’ve seen the advertising for larger companies – slogans like “Hire a Vet” or “We Offer Second Chances” – appealing to certain groups that would be interested in applying for a job, sparked by this type of focused outreach. To combat the labor shortage that some companies are facing, they are expanding their hiring pool to drum up new applicants that might have barriers to employment. These hiring initiatives help to drive down the unemployment rate for groups that have a hard time re-entering the workforce after transitioning from challenging life experiences.

Read More

From Blueprint to the Courtroom, the Harper Case is a Win for Design Firms

Written by Katherine Johnson, Esq. Updated Jun 6, 2023.

For several years, CTI has championed construction companies’ eligibility for the credit for increasing research activities (“R&D tax credit”) under Section 41. We have worked with numerous construction companies to successfully identify, calculate, and substantiate the credits. The most recent tax court opinion lends support to the qualification of many aspects of design-build construction projects.

Read More

174 is on the move - What you should know!

Written by Katherine Johnson, Esq. Updated May 18, 2023.

Current State of Section 174

As discussed in our recent blog, the Tax Cuts and Jobs Act (TCJA) of 2017 included a delayed provision that requires taxpayers to begin capitalizing and amortizing research and experimental (R&E) expenditures under Section 174 for tax years beginning after December 31, 2021. Prior to this provision, taxpayers had the option to deduct R&E costs in connection with the taxpayer’s trade or business during the taxable year incurred. Starting in tax year 2022, R&E costs will need to be capitalized and amortized over a 5-year period for domestic expenses and over a 15-year period for foreign research, beginning with the midpoint of the taxable year in which such expenditures are paid or incurred.

Read More

Increased IRS Scrutiny of Employee Retention Credit

Written by Katherine Johnson, Esq. Updated Apr 19, 2023.

Recently, the Internal Revenue Service (IRS) published its annual Dirty Dozen list, which is intended to raise taxpayer awareness of potential scams and fraudulent tax practices. The list includes cautions against falling prey to scammers calling and texting to pose as IRS or state tax officials, reminding taxpayers that the IRS initiates contact with taxpayers primarily through regular mail and never through email, text, or social media. Additionally, the IRS advised against acting on tax tips posted on social media, noting a couple of specific tax schemes that have recently gone viral amount of tax fraud.

Read More