Instructions: Based on the information provided, complete the calculations below. Regular Method 2023 Wages Supplies Contract Research
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Instructions: Based on the information provided, complete the calculations below. | ||||
Regular Method | 2023 | |||
Wages | ||||
Supplies | ||||
Contract Research | ||||
Qualified Research Expenses (QRE) Total | ||||
Average Annual Gross Receipts | ||||
Fixed Base Percentage | assume first five years, use 3% | |||
Computed Fixed Base Amount | ||||
50% of QRE | ||||
Greater of 50% of QRE or Base Amount | ||||
Incremental QRE | ||||
R&D Tax Credit @ 20% | ||||
Reduced Credit (Section 280C) | 79% | |||
Alternative Simplified Credit Method | 2023 | |||
Wages | ||||
Supplies | ||||
Contract Research | ||||
Qualified Research Expenses (QRE) Total | ||||
First Prior Year QRE (Tax Year 2022) | ||||
Second Prior Year QRE (Tax Year 2021) | ||||
Third Prior Year QRE (Tax Year 2020) | ||||
Average of 3 Prior Years' QRE | ||||
50% of Average 3 Prior Years' QRE | ||||
Current Year QRE - 50% of Average 3 Prior Years | ||||
ASC (Fed Credit Rate = 14%) | ||||
Reduced Credit (Section 280C) | 79% | |||
Summarize the total 174 expenses from the detail: | ||||
US* | ||||
Section 174 Wages | ||||
Section 174 Supplies | ||||
Section 174 Contractors | ||||
TOTAL | $ - | |||
*Assume no Foreign | ||||
What is the year 1-6 amortization expense for these costs (5 year amortization, for year 1, there is a half year convention, meaning half of the annual amortization is taken)? | ||||
Year 1 | ||||
Year 2 | ||||
Year 3 | ||||
Year 4 | ||||
Year 5 | ||||
Year 6 | ||||
Total | ||||
What two points did the IRS clarify in Notice 2024-12 with respect to contract researchers? | ||||
Per the Revenue Procedure 2024-9, will there still be audit protection for Section 174 expenses that were ignored in 2022? |
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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