Proposed Legislation Offers Big Tax Break to Entrepreneurs

A new bipartisan bill introduced in Congress – the Startup Innovation Act of 2013 – promises a big benefit to entrepreneurs via a new research and development tax credit.

The bill, which was originally introduced last summer, was reintroduced in the Senate in late January.  A House bill that would mirror the Senate bill is expected to be introduced shortly.

If passed, the new law would allow companies that are less than five years old and have less than $5 million in total revenue to claim a research and development tax credit of up to $250,000 against their employment taxes.

It is typical for firms to deduct R&D expenses from taxable profits, but under the new law, if a company has not yet made a profit, it can deduct its R&D expenses from employment spending.

Legislators said that it has been the larger companies that have benefitted in the past from R&D tax credits; the new legislation is aimed at incentivizing entrepreneurs to invest in innovation.

Coupled with the changes to benefit startups and small businesses provided by the JOBS Act, this new bill offers a jumpstart to entrepreneurs considering the formation of new companies across the country.

The following two tabs change content below.

The Parents Estate Planning Law Firm, PC

At The Parents Estate Planning Law Firm, we answer your questions at your convenience; we stay in frequent communication; and we meet to discuss changes in life circumstances and in the law to ensure that your assets are protected.

Latest posts by The Parents Estate Planning Law Firm, PC (see all)



VISIT OUR WEBSITE TO LEARN MORE

The Parents Estate Planning Law Firm, PC is a unique estate planning law firm serving families in Massachusetts. Our team is committed to helping parents at all stages make sure their loved ones are completely protected if the unexpected happens, while making things as easy as possible for their families.

31 Nagog Park, Suite 301, Acton, MA 01720 | 978-263-6900 | [email protected] | www.ParentsEstatePlanning.com