Posted by William Mehi on 11.08.18
Bringing intelligent robots into every home across the United States means tackling the challenges of hardware, software and design. With the recent announcement of Amazon’s plan to build a domestic robot with Alexa assistance, things are progressing beyond the conventional vacuum cleaning and lawn mowing robots. Social robots have also started emerging, and companies like Intel are planning launches of new companion robots, in an attempt to tap the growing senior populations’ need for service. Through computing innovation, companies are pushing the boundaries of smart and connected technology to make amazing experiences possible for every household across the U.S.
Businesses in the robotics industry are performing research and development in everyday activities and most are not aware these operations could qualify for a dollar-for-dollar reduction of their income tax liability. If your company attempts to create products that are lighter, less expensive, reliable or more precise, the R&D tax credit adds up to money that can be reinvested into your business, rather than pay out to the IRS or state governments.
Tax credits can deliver immediate and significant benefits to your company as a result of your innovative activities. Benefits include:
The R&D tax credit, originally enacted as part of the Economic Recovery Tax Act of 1981 was designed to encourage investment in innovation in the United States. The credits are also intended for activities related to process design and development. Examples include new techniques, formulas, processes, software and the use of innovative materials to create more reliable, energy-efficient products or processes.
Robots with mapping and spatial awareness capabilities and how they will play an important role in allowing other smart devices in the home to more seamlessly work together is just one example of innovation taking place in the home robotics industry. Developers are also exploring ways for robots to control all the devices and appliances in your home with just voice commands.
Many activities in the domestic robotics industry will qualify for the R&D tax saving credits, including but not limited to the list below.
While R&D tax credits are available, it can be challenging to navigate through the complexities involved with qualifying for the tax credit and the necessary documentation. For example, to be eligible, an activity must meet a four-part test. A qualified R&D tax credit expert can help determine which activities qualify and help you with the required documentation.
The R&D tax credit can be a lucrative incentive for innovative businesses. Given the new permanent nature of the federal tax credit, now is the time to consider whether activities performed by your company qualify for major cash-saving tax credit opportunities.
Tax Point Advisors, a firm with expertise in working with small and midsize companies, works with businesses that may qualify for R&D tax benefits. For more information, call us at 800-260-4138 or please leave us a message below.