- Effective for taxable years beginning after December 31, 2009, partners in a partnership and shareholders in a S corporation may now take the R&D credit (previously, only C corporations could take the credit).
- The tax credit is now equal to 10% (was 5%) of the first $2,000,000 of the excess (if any) of the qualified research expenses for the taxable year, over the base amount; and 2.5% on all of such excess expenses over $2,000,000.
- The credit for taxable years beginning after December 31, 2009 is refundable (previously, was not refundable).
All pass-through entities should seek to take advantage of the Minnesota research and development credit for the first time in 2010.
In addition, all companies that have had losses for several years, and have never taken a Minnesota R&D credit, should seek to take advantage of the credit in 2010 to obtain a refund.
Please contact me at email@example.com to conduct a research and development credit study to not only determine if you qualify for a credit, but also to gather the information, and documentation to support and quantify your credit (which can now be turned into cash even if your company has net operating losses).