Research Tax Credit
Entrepreneurs who conduct research that is technological in nature to develop or improve a business product may be able to claim the research credit, which is part of the general business credit. The research credit is similar to the research and experimentation deduction, however, it is narrower since it only covers costs for research that is technological in nature, amongst other things. By claiming qualifying research activities under the research credit instead of deducting as general research and experimentation costs, you may receive a greater tax benefit since credits directly offset your tax liability. The research credit can give Entrepreneurs a significant tax break, however, it is a complicated and very nuanced credit so be sure to consult with your tax advisor to determine how you should treat your specific research costs.