Although the R&D tax credit remains unchanged under the new U.S. tax code, some companies may still be leaving millions of dollars on the table.
By Taylor Ovalle
Even though the multimillion dollar Research and Development (R&D) tax credit remains unchanged under the new U.S. tax code, some companies may still be leaving millions of dollars on the table.
Why? The paperwork.
Although the credit could be lucrative – the government subsidy was calculated to be $148 billion for U.S companies over the next 10 years, or, millions of dollars annually, per company – the documentation necessary to realize the tax credit creates an incredibly challenging administrative requirement. In addition to having to prove their increase in spend on “qualifying R&D,” companies must also work through a lot of tax law.
“We’re leveraging IBM’s Watson to help companies cut through this complexity,” said Brad Brown, chief tax innovation officer and technology leader, tax, at KPMG. “Our tax professionals are feeding Watson with information so that it can learn to correctly and consistently pinpoint the right data that can help us assess a company’s qualifying R&D.”
Brown delivered a keynote presentation on this topic at IBM's Think 2018 event in Las Vegas, in which he demoed how Watson can save companies cash.
KPMG’s tax cognitive platform with Watson (watch an overview on YouTube here) includes the ability to examine relevant documents to help companies obtain evidence identifying research projects eligible for credit subsidies and provide higher-quality documentation to help retain the credit subsidy. Automated document examination saves time on research so that business professionals can spend their time on higher value, more strategic activities.
“Claiming the R&D income tax credit is a benefit for companies of all sizes, allowing them to reinvest the cash in new and innovative products and processes,” said Steve Rainey, chief innovation officer and national leader for data and analytics, tax, at KPMG.
Just another example of how KPMG is putting AI to work to drive faster, more accurate, and more beneficial tax decisions.
To speak to Brad Brown or Steve Rainey about Watson or intelligent automation in tax, contact Taylor Ovalle.
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