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IRS Faces Backlash Over New Research Credit Refund Policy

Oct. 20, 2021, 8:05 PM

Tax attorneys are pushing back against new IRS requirements for companies filing research tax credit refund claims, saying the policy is unworkable and unfair.

Businesses can claim a tax credit under tax code Section 41 for increasing research and development spending. The IRS Office of Chief Counsel, in an Oct. 15 memorandum, said that when filing a refund claim for the credit, taxpayers must provide detailed information on all research activities performed, the individuals who conducted each activity, and the information they were seeking to discover.

The IRS said the new requirements are needed because it receives ...