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Randy Lieberman from Earnd talks about R&D Tax credits for Startups

Startup Tax Credits for Innovation

Mary Scott from Business Riff welcomed Randy Lieberman from Earned to discuss research and development tax credits for startups. Randy explained that these tax credits are stimuli promoting innovation in the United States, covering work from ideation to testing done by employees or contractors. He clarified that the credits can be applied against taxes, including payroll taxes, to stimulate innovation and competitiveness.

Tax Credits for Pre-Revenue Companies

Randy explained that companies can carry over tax credits for 20 years and use them to offset payroll taxes, even for pre-revenue companies. He clarified that these credits apply to wages paid to developers, independent contractors, and cloud development efforts, particularly in AI and software development. Mary understood that these credits could be valuable for companies in their fifth year of operation when profits are likely to be high.

Research Credits Application Process

Randy explained the process for applying research credits, which involves meeting with companies to assess their qualified research projects in hard sciences like AI, computer science, engineering, physics, chemistry, and biology. They help companies calculate expenses, document efforts, and coordinate with CPAs for filings, with the added benefit that companies no longer need to capitalize expenses over five years due to recent legislative changes.

Startup Tax Credits and IP Protection

Mary and Randy discussed the importance of research and development tax credits for startups and emphasized the need for employment agreements with employees and independent contractors to protect intellectual property. Randy highlighted the significance of making structuring decisions early to ensure investments are well-placed and intellectual property rights are secured. Mary encouraged startups to book a call with her for further assistance and mentioned that they would provide information about Randy's company for interested parties.

What are R&D Tax Credits and How Do They Work.

https://www.earnd.co/what-are-rd-tax-credits-and-how-do-they-work/

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