In an effort to stimulate the development of “next-gen” technology companies, New York State offers a number of tax incentives for companies conducting research and development in emerging technologies. The credits are available for firms certified as “qualified emerging technology companies,” as well as for investors in such certified firms.

Awards are based on research and development expenses, jobs created, and overall costs for facilities, operations and training. Qualifying expenses include expenditures on equipment and property used for R&D, R&D employee salaries, patent and IP protection costs (excluding litigation), travel related to R&D, and company overhead on R&D activities.

You could receive between 9 and 18 percent of your total eligible expenses as a tax credit, and if you pay no taxes you will receive a check directly from the State.

Do I qualify?

EFPR Group has significant experience in determining QETC eligibility for clients. In general, these tax credits are underutilized by New York State companies. Here are the general rules for eligibility.

Small businesses

You must have annual revenues of less than $10 million.

Investors

You must have made an investment in a qualified emerging technology firm.

In emerging technology industries

It is important to note a wide range of industries are eligible. You may still be qualified even if your industry is not on this list. Please contact us and we will check for your specific eligibility.

• Biotechnology
• New media
• Electronics and photonics
• Software development
• Defense technology
• Alternative energy technology
• Advanced materials and processing technology
• “Green” technology
• Information and communication technology
• Medical devices
• Remanufacturing technology
• Transportation technology

R&D expenses

The firm must spend at least 3.6 percent of its revenue within New York State on research and development (R&D) expenses.

The next step

We suggest a preliminary consultation with one of our experts on emerging technology. The meeting is free and does not obligate you in anyway. Together we review your most recent Federal and State returns, help determine your eligibility and estimate the potential tax credits you can pursue. We also provide you with an estimate of our time to prepare your initial qualification documents and the annual calculations and claim forms.

Don’t miss out

There are a number of different tax credit categories; employment credits, a capital credits, and facilities, operations and training credits.

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