Products Finishing

OCT 2013

Products Finishing magazine is the No. 1 industrial finishing publication in the world. We keep our readers informed about the latest news and trends in plating, painting, powder coating, anodizing, electrocoating, parts cleaning, and pretreatment.

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Page 102 of 115

FINANCIAL FINISHING stimulus in light of the recession. One of the provisions allowed for the R&D credit to be carried back up to five years and forward up to 24 years if the credit can't be used in the year it was generated. Another provision was written into the law to help businesses who experienced losses. These rules extend the carry-back when the company has a net operating loss, or NOL. These special rules ensure companies who have R&D can actually use the credit. The following example shows how valuable the carrying provisions can be. Company A calculates a $70,000 credit in 2009, but the company has no taxes in 2009 to apply the credit to. Instead of abandoning the $70,000 benefit, the company can look at the taxes it paid in 2008. If it paid more tax than the bare minimum, the company can apply the $70,000 to 2008 and possibly get a refund. If the company also did not pay taxes in 2008 or if it cannot use the full $70,000 in 2008, the company can use the credit beginning in 2009 on a go-forward basis for as many as 20 years until the full credit is used. Discover Perfectly Clean™ Filings Constant This flexibility also explains why the number of taxpayers filing for the R&D credit has remained so constant despite the serious economic downturn that began in 2008.** Many companies began experiencing losses in 2008 and throughout 2009. However, because of this carry feature, the value of calculating the credit is still very high since it can be used on previous or subsequent years. Without this utilization flexibility, many companies would not have taken the R&D credit if they experienced losses in 2009 or 2010. For a tax credit that presents such huge potential benefits, the only question remaining is "Why haven't I taken advantage of this before?" The truth is that the regulations behind the R&D credit are not always easy to interpret. Attempting to complete the credit without understanding the details in the law could prove disastrous and frustrating. Even many CPAs are not comfortable calculating the credit because they do not possess the experience needed to efficiently calculate it correctly. A consultant with a specialized understanding of the credit may be a valuable investment. These consultants can do much of the heavy lifting while limiting your involvement to providing financial information and time for interviews. By limiting the burden on you, a consultant can put this valuable credit easily within reach. *Numbers calculated based on Totals of Research Credit Amounts by size of Business Receipts for Tax Years 1990 2009 and Number of Research Credit Claimants by Size of Business Receipts for Tax Years 1990 - 2009 ( article/0,,id=164402,00.html). **Numbers based on Number of Research Credit Claimants by Size of Business Receipts for Tax Years 1990 - 2009 taxstats/article/0,,id=164402,00.html). Precision Cleaners High performance materials deserve a precise level of critical cleaning. That's why MicroCare features DuPont™ Vertrel® specialty fuids, the most powerful degreasing products in the industry. MicroCare and DuPont partner to provide the best technical cleaning fuid support. Call MicroCare to ensure perfectly clean parts, every time. Call: 1.800.638.0125 Email: "MicroCare" and the MicroCare logo are registered trademarks of MicroCare Corp. Copyright © 2013 DuPont. DuPont™ and Vertrel® are trademarks or registered trademarks of E.I. du Pont de Nemours and Saqib Dhanani and Lyndsie Lowry are attorneys with Paradigm Partners, Company or its afliates. All rights reserved. PRODUCTS FINISHING — 101

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