Advanced Webinar Slides Vr2 2 20 2009

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R&D Tax Credits

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Advanced Webinar Slides Vr2 2 20 2009

  1. 1. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  2. 2. Presentation Overview I. Introduction II. R&D Definition III. Calculations & Structure IV. Case Studies V. Audit Process & Method VI. Engagement Process VII. Questions This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  3. 3. Corporate Overview • Corporate Headquarters in Houston, Texas. • Offices Nationwide including Pennsylvania, California, Florida, North Carolina, Illinois, and Canada. • Assisting CPA’s and their clients recover millions in R&D Tax Credits. • We specialize in legal, technical (engineering) and tax knowledge of the Internal Revenue Code (IRS) Section 41. • Our Staff includes the industry’s most experienced IP Attorneys, R&D Engineers, Scientists, and IRS Audit Experts from national tax consulting firms. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  4. 4. Areas of Expertise Manufacturing Fabrication Engineering Software (ERP) Chemical Tool and Die Machine Shops Plastics Manufacturers Pharmaceutical Biotechnology Food Sciences/Manufacturers This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  5. 5. IRS Definition of R&D Traditional Definition Tax Definition 1. New or Improved Business Component Product, Process, Software (Internal or External), Technique, Formula, or Invention. 2. Technological in Nature 3. Elimination of Uncertainty 4. Process of Experimentation This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  6. 6. New or Improved Business Component A business component can be a product or a process, and can include the following: • Manufacturing products • Developing or improving production • Developing new, improved, or more and/or manufacturing processes reliable products / processes / formulas • Performing environmental testing • Developing prototypes or models • Developing, implementing, or (including computer generated models) upgrading systems and/or software • Designing tools, jigs, molds, and dies • Automating and/or streamlining • Developing or applying for patents internal processes • Performing certification testing • Expending resources on outside • Conducting testing of new concepts & consultants/contractors to do any of the technology above-stated activities • Developing and introducing new • Attempting the use of new materials technology and compounds This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  7. 7. Technological in Nature The taxpayer is seeking information that is technological in nature: The Technological in Nature component is based on the process of experimentation used in the research relying on the principles of hard sciences, such as physical or biological sciences, engineering, or computer science. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  8. 8. Elimination of Uncertainty The research and development activities must eliminate uncertainty either about the capability or method of developing the product. In addition, the elimination of certainty of the improvement of the product or its appropriate design is also sufficient to meet this requirement. Most product development is concerned with the elimination of uncertainty regarding capability, method, or choice of appropriate design. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  9. 9. Process of Experimentation The Process of Experimentation involves the evaluation of one or more alternatives where there exists uncertainty at the outset as to the appropriate design of the business component. The Taxpayer may conduct a process of evaluating the alternatives through systematic trial and error, developing one or more hypotheses, designing and conducting experiments to test the hypotheses, among other things. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  10. 10. 3 Part Heightened Software Test The rules for software development are still somewhat complicated, but one recent clarification states that if customized software is developed for sale or lease (not for internal purposes), then it is not subject to the extra hurdles of the High Threshold of Innovation Test. If a company develops internal use software, however, it may still qualify for the R&D Credit, providing that: 1. The software is highly innovative; 2. The development involved significant economic risk, and 3. A similar product is not commercially available. If the above three criteria are met, then the cost of developing software for internal use may qualify for the R&D Credit. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  11. 11. Quality Control vs. Quality Assurance 1. Quality Control (QC) does NOT qualify if QC relates to the final testing and inspecting stage before the final product that was mass produced is shipped out. 2. Quality Assurance (QA) does qualify if QA relates to testing being performed at the early development stages, such as prototyping or first article stage. The employees in this department normally get involved in numerous process improvement activities in addition to testing processes of different products being manufactured.
  12. 12. Qualified Research Expenditures Wages • Form W-2, Partnership Earnings subject to Self Employment Tax, Schedule C, bonuses paid to employees • Excludes 401(k) & fringe benefits Supplies • Cost to fabricate prototypes / items consumed in R&D process • Any tangible property used in the conduct of qualified research other than land or improvements to land, and property subject to depreciation 65% of Contract Research • Fees paid to non-employees, outside consultants / engineers / software developer Net Benefit is around 6.5% with Regular Credit Net Benefit is around 4% with Simplified Credit
  13. 13. Substantially All Rule Substantially all rule was designed primarily for engineers, designer, scientists and programmers. It refers to when an employee or contractor spends 80% or more of their time performing qualified work as per Section 41, the employer is allowed to capture 100% of their salary towards Qualified Research Expenditures (QREs). This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  14. 14. Regular Method vs. Simplified Method 1. Regular Method a. Base % and Base Amount is factor in calculation which can hurt the credit b. Maximum net benefit is around 6.5% of the QREs 2. Simplified Method a. Base % and Base Amount is NOT a factor in calculation. b. Average net benefit is around 4% of the QREs c. Use this method when Regular credit method is resulting less than 4% net benefit due to base % d. If the average QREs for past three years is less than QREs for the year under study, then net benefit will be more than 4%; otherwise less than 4%. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  15. 15. Passive vs. Non-passive (Important for S Corp or Partnerships – Flow Thru Entities) 1. Passive (non active) Shareholders: a. Their credits are amortized over 10 years b. In order to utilize these credits over 10 years, the shareholder must be paying regular taxes c. They will experience substantial additional tax 2. Non-Passive (active) Shareholders: a. As long as the shareholder is paying regular taxes, they will receive refunds.
  16. 16. Purpose of Base % and Base Amount 1. Base %: Factor that is calculated based on how the Gross Receipt and QREs for past years have increased or decreased in comparison a. If the QREs increase in same or better proportionate to Sales, then the Base % will be small. b. If the QRE’s decrease, but Sales increase, then the Base % will be higher c. Smaller the Base %, higher chance that Base Amount doesn’t hurt the credit 2. Base Amount: Base % times Avg gross receipts Threshold a. QREs must be higher than this Threshold to get any credit using Regular method. b. To get 6.5% net benefit, QREs must be at least twice as much as Base Amount Threshold, therefore “increasing” research! This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  17. 17. Base % for 80’s Based Company 1. Must have been formed prior to 12/31/1983 2. Must have had QREs and Gross Receipts during at least 3 of the following 5 years – from 1984 – 1988 3. Base % historically has been around 1% on average. 4. Base % once determined will remain fixed for all years to come 5. Lower the base percentage (max up to 16%), chances are high that the base amount doesn’t hurt the credit using the regular method. 6. Most 80’s base companies don’t have base period issues and normally have 6.5% net benefit (max) using regular method. 7. Properly calculating the base % for 80’s is very critical due to its advantages versus start up companies, as this is one of the red flags in Audit. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  18. 18. Base % for Start-up Company 1. Must be formed on or after 1984 2. If the first year of conducting R&D is before 1994, for calculation purpose, code requires to choose 1st R&D year as 1994; unless first year of conducting R&D is after 1994, then choose that year as 1st R&D year 3. Base % for 1st 5 years is fixed at 3% using regular method 4. 6th Year, the Base % normally drops, and then in time goes up 5. Maximum Base % is 16% 6. Base % historically has been around 3% on average. 7. If the Base % is high which causes the Base amount to hurt the credit using regular method, then use the simplified method which will result in about 4% net but may result higher net benefit in some scenarios. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  19. 19. Importance of Statutory and Current Year Tax Deadlines 1. Statutory deadline: If missed, the client will miss out on 1 out of 4 years of study, therefore 25% of the credit. That missed year of credit could pay for the entire study. 2. Current Year deadline: If missed, the client will have to amend the tax return. It is always better to file than amend a return. In addition, by amending a return, sometimes, the client may experience paying additional taxes upfront if in AMT situation. However, if the client simply files the credit with the return, the client will elect reduce credit and avoid paying any additional taxes even if in AMT situation.
  20. 20. Example: Foam Products Manufacturer Sampling of activities: • Design of packaging foam • Design of packaging processing methods • Physical design of packaging components • Prototype design • Prototype testing Annual Payroll • 2004 – $18MM • 2005 – $19MM • 2006 – $20MM • 2007 – $21MM Net Credit Benefit for 2004 thru 2007 tax years: $1,200,000 This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  21. 21. Example: Software Company Sampling of activities: • Designing Software • Coding • Programming • Improving Application Features • Functionality Improvements • Alpha, Beta Testing • Improving Modules Annual Payroll • 2004 – $5MM • 2005 – $6MM • 2006 – $7MM • 2007 – $8MM Net Credit Benefit for 2004 thru 2007 tax years: $500,000 This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  22. 22. Example: Custom Plastic Products Sampling of activities: • Pipe and Filtration Systems • Prototyping • CAD/CAM • Precision CNC Machining • Solvent and Adhesive Bonding • Quality Assurance • Thermoforming Process Annual Payroll • 2004 – $10MM • 2005 – $11MM • 2006 – $12MM • 2007 – $13MM Net Credit Benefit for 2004 thru 2007 tax years: $700,000 This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  23. 23. Example: Tool & Die Shop Sampling of activities: • Plastic part manufacturing, • Rapid prototype modeling, • Design – AutoCAD, • Aluminum prototype tooling, • Silicone tooling, • Injection, Blow, Compression molding, • Vacuum forming. Annual Payroll • 2004 – $2MM • 2005 – $3MM • 2006 – $4MM • 2007 – $5MM Net Credit Benefit for 2004 thru 2007 tax years: $200,000 This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  24. 24. R&D Audit Overview 1. Tier 1 Issue 2. Auditors are comprised of Engineers and IP Attorneys 3. IRS approach is blanket denial of all credits 4. Burden of Proof on the company This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  25. 25. IRS Methodologies 1. Project by Project with Established Nexus (Recommended before by IRS but now required) a. Timesheet breakdown by Project by Project b. Discussing activities within each Project c. Identifying employees and contractors who worked on those Projects and which activities they contributed their time towards. d. Only way to maximize the benefit and have proper substantiation 2. Hybrid a. Identifying few major projects b. Identifying technical employees and contractors who perform qualified activities c. But not linking the two (a and b) d. May maximize the benefit, BUT doesn’t meet the proper documentation requirement 3. Cost Center a. Extracting cost by departments b. Allocating rough % to each employee with the technical departments c. Will NOT maximize the benefit, NOR meet the proper documentation requirement This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  26. 26. R&D Audit Process 1. R&D Audit Process is handled by IP Attorneys 2. Due to our litigation, negotiation and engineering resources, we have an Audit defendable rate of 92% 3. Our Approach is to thoroughly analyze all areas where we are extracting QREs from to ensure such costs are defendable 4. We draft our engineering report and timesheets in the format IRS like to see if following project by project approach. 5. Our approach is to give the IRS what they want quickly, efficiently and in an easy to follow format. This speeds up the Audit and we have better negotiation power. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  27. 27. Shrink Back Rule 1. Shrink back rule: In IRS Audit, IRS Engineer may question certain portions of identified Qualified Research Expenditures (QREs). If the IRS claims that a certain project, activity, or individual’s time doesn’t qualify at all or doesn’t qualify to a degree that was identified in the Study, they can try to disqualify that portion of the credit. If they are successful or if the Client wants the case settled, then the IRS will shrink back the credit. 2. The purpose of this rule is to not deny all the credit, but a portion that the IRS disagrees with. The government wants to reward this credit to all who qualifies for this benefit and follows the procedure with proper documentation. Their intention is not to deny the credit, but simply make sure the client deserves it and have followed the approved methodology (i.e. project by project). This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  28. 28. The Process This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  29. 29. Process – Pre-Qualification Utilization Analysis • Collect Financials such as corporate tax returns, AMT forms, W-2’s, job titles for each year in review •Review Form 6765 to determine if the credit has been taken previously and determine if incremental opportunity exists Base % Analysis • Analyze financial information provided to determine whether company is “80’s” based or a “start up” and decipher if base percentage will significantly impact or prevent company from taking credit. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  30. 30. Process – Phase I Identification • Identify projects, processes, technologies, and employees associated with qualified activities •Identify supply costs and contractor costs Data Collection • Collect technical documentation to substantiate qualified research activities • Collect remaining financial information and documentation for contractor and supply costs This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  31. 31. Process – Phase I Cont’d Interviews • The interviews are conducted between Paradigm’s engineers and IP attorneys and the client’s technical staff • Acquire high-level technical information on qualified projects • Determine employee and contractor eligibility towards qualified R&D activities • Quantify and determine R&D expenditures Calculations • Perform analysis of financial data • Accurate determination of Federal and State R&D Tax credits This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  32. 32. Process – Phase II Reporting • Finalize technical data through follow-up interviews as needed • Create or obtain technical drawings, schematics, designs, formulas and mathematical computations • Preparation of R&D Report • Release of R&D Tax Credit Forms and Schedules to CPA and or client for amendment or filing Final Review • Engineering study reviewed by Production Director to verify accuracy of all substantiating documentation This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  33. 33. Product Deliverable The R&D Study / Technical Report • The R&D Study / Technical Report is where all the arguments, documentation of qualification and quantification must coalesce into a coherent statement of who, why, when, where and how much. This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  34. 34. Product Deliverable • Many clients lack the engineering drawings necessary to substantiate the claim. Paradigm’s engineering team can recreate the data for presentation to the IRS. • Most companies’ R&D Credit is derived from a wide variety of activities and processes therefore the engineering report is critical. • The engineering report serves as the first line of defense in the event of an R&D audit.
  35. 35. Production Timeline Collect Phase I Interview Credit Phase II Technical Receive Refund Financials w/ Client Calculations Report 8– 10 Hrs. 2-3 Weeks (Avg) 6–8 Weeks (Avg) 8–16 Weeks Proposal Proposal Letter Letter Document Key Employees & Qualified Projects This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  36. 36. Summary • IRS Definition of R&D • QRE Calculations • Case Studies • R&D Audit Review • Study Process and Timeline This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  37. 37. Questions? This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.
  38. 38. For more information, Please Contact: Paradigm Partners 14825 Saint Marys Lane Suite 102 Houston, TX 77079 Phone: 281-558-7100 Fax: 281-558-7900 info@ParadigmLP.com www.ParadigmLP.com This document and/or electronic file contains information that (a) is or may be LEGALLY PRIVILEGED, CONFIDENTIAL, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of Paradigm Partners. You must have written authorization from Paradigm Partners to use, copy, or distribute any part of this document as it is strictly prohibited.

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