Diving into the Employee Tax Credit (ERC). What Is It and Could You Be Eligible?
R&D For You and Me – The R&D Tax Credit and Why You Should Care About it.
💡Guest: Tyler Kem Co-Founder & Vice President of Strike R&D Tax Advisory, tax consultant, and entrepreneur
💡Who is Tyler Kem?
Tyler Kem is a tax consultant and an entrepreneur. He is the Co-Founder and Vice President of Strike R&D Tax Advisory,
💡What is Strike R&D Tax Advisory?
Strike R&D Tax Advisory is a consulting firm that helps customers gain insight into the world of R&D tax law and aids in re-fueling their innovation.
💡R&D Tax Credit
R&D Tax Credit is “a permanent federal tax credit in 2015, as part of the Path Act, which is really what opened up an immense amount of opportunities for startups, specifically, but also allowed for many other industries to start claiming that tax credit.”
The qualifications are very broad, with a basic rule of thumb: everything fundamentally relies on hard science. This applies to:
- Computer science
- Engineering
- Biology
- Physics
- Chemistry
So if you’re a company in these industries, you probably qualify.
- Technology
- Engineering
- Food & Beverage
- Consumer Goods
- And tons more
The R&D Tax Credit is a U.S. labor-based incentive. Instead of outsourcing, you can qualify if you keep your labor inside the U.S., which comes with paying higher wages.
💡Starting the Process
Many people who qualify for the R&D Tax Credit aren’t willing to pay the upfront fees, the retainers, and the monthly billings to claim the credits. And some companies are 10, 20, 30, even $40,000 out of pocket before they even know the size of the credits they’re going to be getting.
💡How Strike Can Help
So Tyler’s company Strike does a few things that make the process a whole lot easier:
- Aligned their interests with the interests of the client from day 1
- No out of pocket costs
- No retainers
- No monthly billing OR fixed fees
- Success based fee structure (so they don’t get paid until the company is able to use their credits)
- Offer unlimited audit support (in terms of hours… So if something gets challenged, they’ve got your back)
- They EVEN give a fee guarantee on their claims, so if the IRS decides to claw back on 10% of the credits, 10% of their fees go back to the client.
If you want to go back in time and apply for these benefits before becoming aware of this credit, you can! The federal statute of limitations is three years from the filing date, so you can go back to the 2018 tax credits and see what cash refunds you have waiting for you!
💡How Does the R&D Tax Credit and the R&D Tax Provisioning Play into Financial Audits?
There are a few steps:
- The Document Gathering Phase
- The Calculation Process
- The Deep Dive Phase
During the first phase, they can gather all of the financial documents; then they work with the business owners and software developers during the second phase. Then they can really understand their systems and find a nexus in between the expenses. Strike’s job is to work FOR the company; they’re not working for Strike!
If this doesn’t apply to you, tons of deductions and credits could be available to you in your own personal tax return, so don’t miss out.
💡Want To Learn More about Strike and Tyler Kem?
You can reach Strike directly at striketax.com, you can also email him directly at Tyler@striketax.com, or you can call the number on the website and speak to one of the people there! They’re here to help you out.