IRS Form 6765 is a significant tax document in the United States that assists businesses in claiming tax credits for qualified research and development (R&D) expenses.
Eligible entities such as corporations and, in some cases, partnerships and sole proprietorships engaged in qualified research activities in the USA can file Form 6765.
Eligibility for the R&D tax credit typically applies to businesses engaged in qualified research activities that seek to discover or improve technological knowledge.
Qualified R&D activities encompass the systematic, technical, and investigative processes conducted by businesses to develop or improve products, processes, software, or formulas.
There is no fixed amount for the R&D tax credit, as it is based on a percentage of qualified research expenses and can vary from business to business. Typically, the credit ranges from 6% to 20%.
The Research and Development tax credit can be calculated using either the regular credit method or the alternative simplified credit (ASC) method.
The R&D tax credit in the United States allows businesses to carry forward and, in some cases, carry back unused R&D tax credits to offset tax liabilities in other years.