Prior to 2016 – the R&D Tax Credit could not be taken against AMT. That’s all changed now.

That means if you run a company and AMT has traditionally kept you from further reducing your tax liability, 2016 is your year.

“Start-up companies” (companies with less than $5 million of gross receipts for the year and no gross receipts more than five years ago) can use R&D credits to reduce a portion of their federal payroll taxes going forward – specifically the employer’s Social Security portion of FICA taxes (6.2% of wages up to $127,200 per employee in 2017).

That means if you run a company and AMT has traditionally kept you from further reducing your tax liability, 2016 is your year.

Now you can use the R&D Tax Credit to reduce your tax bill below AMT. That’s why 2016 and beyond is the time to jump on the R&D Tax Credit.

These changes are great for both small and mid-size companies; life sciences, biotech, food science, bio-flavoring, breweries/distilleries, aerospace, industrial automation and controls, architectural firms, engineering design, structural/architectural materials, tool & die companies, software & web development, and more. The PATH Act changes even allow for pre-revenue “start-up” firms to offset their FICA tax liability with this R&D tax credit.

Get your research qualified for tax credits.