Bipartisan Roberts bill would encourage small business use of R&D tax credit

Bipartisan legislation introduced by U.S. Sen. Pat Roberts (R-KS) on Friday would enable small businesses to take advantage of a new research and development (R&D) tax credit.

The Support Small Business R&D Act, which was introduced by Roberts and U.S. Sen. Chris Coons (D-DE), would require the Small Business Administration (SBA) and the IRS to collaborate on training materials explaining how entrepreneurs who invest in research could be eligible for the R&D tax credit to offset expenses.

“The goal of the 2015 legislation is to make sure that small businesses and innovative startups, the major job creators in our economy, are able to easily access the R&D credit,” Roberts said. “The R&D credit is complicated, so it is critical that small businesses and startups interested in the R&D credit have access to basic assistance from the Small Business Administration and the IRS to put them on the right track to claiming the credit. The bill we introduce today directs the federal government – at no new cost to taxpayers – to help our job creators to utilize the R&D credit, which will provide long-term benefit to the economy.”

Under the bill, the newly-drafted materials would be supplied to SBA programs and business development groups that partner with SBA programs around the country to help make information about the R&D tax credit more accessible to small businesses and startups.

“By including our proposal to expand the R&D credit to startups and small businesses in bipartisan tax legislation, Congress took a big step towards encouraging our small companies to innovate,” Coons said. “But our responsibility does not end now that this proposal is law. I am proud to work with Sen. Roberts to make sure that our startups and small businesses have the tools they need to take advantage of the R&D credit and continue to invest in advanced research.”

Inspired by the Innovators Job Creation Act, introduced by Roberts and Coons to enable more startups to access the R&D tax credit, Congress acted in 2015 to expand access and to make the tax credit permanent.

Small businesses, however, currently lack information necessary to use the R&D tax credit to offset research costs. The Support Small Business R&D Act aims to close that gap.

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