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Tax Notes Federal: Reduced Research Credit Election May Not Always Be Advantageous

Tax Notes Federal: Reduced Research Credit Election May Not Always Be Advantageous

Brian Abbey
Managing Director, International Tax
Jim Swanick
Managing Director
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  • Publication Company: Tax Notes
  • Publication Author: Brian Abbey|Jim Swanick
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The Section 280C(c) election provides for a reduced research credit as determined under section 41, and is often made for state tax purposes. Taxpayers typically, but not always, made this election before the Tax Cuts and Jobs Act.

However, given the preferential place that the research credit has in the base erosion and anti-abuse tax (BEAT) calculation, this election may not always be advantageous, even considering state tax implications.

In “Reduced Research Credit Election May Not Always Be Advantageous” published in the latest issue of Tax Notes Federal, Brian Abbey, GTM’s Managing Director of International Tax Services, and Jim Swanick, GTM’s Managing Director, Federal Tax Services, illustrate some examples of when the election may not make sense.

About The Author(s)

Brian Abbey
Managing Director, International Tax
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Jim Swanick
Managing Director
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Jim is a Managing Director in Global Tax Management’s lead tax practice based in Wayne, PA. Jim’s broad range of experience working with both publicly...