Time to Revisit General Business Credits

Jan

15

January 15 , 2011 | Posted by Mike Hawkins |

Time to Revisit General Business Credits

In the fall of 2010 Congress radically changed the way that general business credits can be applied for small businesses.  General business credits include the research and development tax credit, the work opportunity credit, the low-income housing credit and many others. In recent years many companies and individuals that qualified for credits were unable to utilize them due to the alternative minimum tax (AMT).  AMT served as a floor for tax liability that even business credits couldn’t reduce.  Because of this AMT limitation, many businesses generated credits that showed up on tax forms, but had very little real world value.

Beginning with credits generated in 2010, general business credits can now offset AMT.  That means those credits will now translate into real money.

Even if you haven’t previously claimed credits, it is now critical that you evaluate potential opportunities from all general business credits.  If you qualify for credits, failing to identify and claim them could be very costly.  The best way to know which credits may be available is to talk to someone who knows your business and the tax code equally well.  We’re always available to help you analyze which opportunities may apply to you.