R&D Credit Reinstated

The 2010 Tax Relief Act retroactively extends the Research Credit for two years.

Extended for tax years 2010 and 2011, companies may receive a research credit (also known as an R&D credit). The research credit equals the sum of: (1) 20% of the excess (if any) of the qualified research expenses for the tax year over a base amount, (unless the taxpayer elected an alternative simplified research credit); (2) the university basic research credit (i.e., 20% of the basic research payments); (3) 20% of the taxpayer’s expenditures on qualified energy research undertaken by an energy research consortium.

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