The Research Credit, the Research and Experimentation (R&E) Credit, the Research and Development (R&D) Credit, and Credit for Increasing Research Activities are all different terms for the same Federal Tax Credit. This Federal Credit is filed on Form 6765 – Credit for Increasing Research Activities.
Current Research Credit situation:
The Research Credit currently expires after 12/31/2009. So, no taxpayer can file for the Research Credit for a period beyond 12/31/2009. Furthermore, no company can take the financial benefit (i.e. inclusion in tax provision) for any Research Credit beyond 12/31/2009. If a company has a fiscal year ending in 2010, they can include the credit for the period within 2009 (and adjust their base accordingly). But, they cannot qualify or include anything for 2010.
Status on Extension:
The House passed the Extenders Bill of which the Research Credit is part of, called “the American Jobs and Closing Tax Loopholes Act of 2010” on May 28th. This Bill is currently being considered in the Senate, with a vote likely coming the week of June 14, 2010. As part of the bill, the Research Credit would be extended exactly like it is currently in place for 2009 and the credit would be extended for just 12 months.
Note: Upon Congress (both the House and the Senate) passing the Bill, the bill doesn’t become law until it is signed by the President of the United States.
For more information please see the previous blog titled “What happened to the extenders bill”.