The IRS has expanded the transition period from 30 to 45 days to provide evidence to back up tax refund claims involving the research and development credit while issuing new guidance.
Each year, the agency receives thousands of research and experimentation (R&E) claims for credits in the hundreds of millions of dollars from corporations, businesses and individual taxpayers. Claims for research credit under IRC Section 41 are currently examined in a substantial number of cases and consume significant resources, the IRS states.
To ensure the claims are valid, the IRS wants taxpayers to identify all the business components to which the research credit claim relates for that year, and for each business component. Taxpayers must identify all research activities performed, name the individuals who performed each activity along with the information each individual tried to discover. See more details.