GUIDE Service Profile : Specialists in US Federal and State R&D Tax
Credits and Incentives
: Reduce US corporate taxes
Obtain large federal R&D tax credits
and other incentives
Many executives may not yet realize the very large cost
savings which can be achieved today through R&D tax credits. The
eligibility criteria have changed so that more types of costs qualify, and
these tax savings can be retroactive and carry forward.
The specialists at alliantgroup do the work to identify and
obtain the potential savings on a success fee basis ( contingent fee tied to
actual savings achieved ).
Thus, if there are no tax credits, there
are no fees to pay.
A quick discussion about recent business activities can
qualify the potential scope for savings, and this work delivers bottom line
results within months. Note that this does not conflict with existing
relationships with public accounting firms, such as for audit and tax
"attest" services for financial reports. This is specialist work to
grow the bottom line.
For example, costs associated with the expansion or
development of new facilities or manufacturing process
improvements (Six Sigma, lean manufacturing, etc.) can now qualify. There are
important details to take full advantage of the potential
savings, such as to properly apportion and document the value of management time or other
costs associated with such investments in business process management and improvement.
The narrow old definition of "R&D" for tax credit purposes no
longer applies, as the recent changes were deliberately designed to reduce
the old eligibility hurdles and reward manufacturers and other types of
for investing in becoming more competitive, as opposed to just investing in
research for new product development or improvements.
Examples : Government R&D Incentive
- Over $500 million in R&D tax credits for clients
- Services to over 1000 private and public companies
Industry: Paint Manufacturing Co.
R&D Tax Credits Realized: $600,000
Industry: Offshore Marine Construction Co.
R&D Tax Credits Realized: $3,400,000
Industry: Software Development Co.
R&D Tax Credits Realized: $800,000
Industry: Injection Molding Co.
R&D Tax Credits Realized: $5,500,000
Industry: Job Shop / Manufacturing Co.
R&D Tax Credits Realized: $400,000
Independent from audit and tax attest services, and
Unlike tax specialists who perform audit and "attest"
services for financial reporting and corporate tax compliance purposes,
their independent advisory services to identify and obtain tax cost savings
do not create a conflict of interest. This is important in the context
of Sarbanes-Oxley independence constraints on consulting services by
In fact, they have performed hundreds of R&D tax credit
studies, and often perform these as specialists in cooperation with the
public accounting and tax compliance services already engaged by the
company, because their independent work to achieve potential tax savings to
improve corporate profits complements the financial audit and attestation
services which confirm the reported performance of the company during that
In other words, alliantgroup doesn't compete to perform such
public accounting audit and tax compliance services. They achieve
bottom-line cost savings through expert tax advisory services to reduce the
tax burden, including not only their work on R&D credits but also
international tax strategies and other potential savings, as summarized
David C. Mayer
245 Park Avenue,
New York, NY 10167
profile : David
How to benefit from this service :
The first step, if there seems to be likely savings potential
after an initial conversation or introductory meeting, is to do the free
preliminary analysis work. This is a non-intrusive feasibility study
to estimate the potential tax reduction more reliably. This would then
be followed by the work to develop and obtain those tax savings as soon as
Website : www.alliantgroup.com
Highlights of their website :
Management Team :
|Scope of Services
Their main focus at this time is on helping companies to
take full advantage of the major cost savings opportunities available
through the new research and development - R&D - tax credits. These
cost savings include retroactive credits which can improve the bottom line
within months, as well as planning for prospective or future tax savings.
Activities by companies in one or more of the following
areas during the past four years may qualify for research and development
tax credits retroactively under the new rules:
- Develop new, improved, or more reliable products or
- Add new equipment
- Improve or build new manufacturing facilities
- Perform environmental testing
- Automate internal processes
- Attempt the use of new materials
- Develop new or improve existing production /
- Lean manufacturing, ISO standards, Six Sigma, etc.
- Perform certification testing
- Develop, implement, and upgrade systems or software
- Perform technology enhancements or develop new
- Develop or apply for patents
- Pay outside consultants or contractors to do any of the
Potential impact on capital investment projects
Companies which are investing in new factories,
distribution centers, R&D centers, or other new or expanded US operations
typically negotiate various types of project incentives with state and local
officials. Some examples of this are shown at right.
They may not even recognize the potentially large savings
which the federal R&D tax credits can offer for changes which they are
likely to be making at the time of such investments in the growth of their
business, such as the improvement of their production, distribution, or
other business processes. Typically, prior to making major new capital
investments to support their growth strategy, companies may have invested in
recent improvements to their operations which might now qualify for
retroactive tax credits.
These credits can also be very relevant to business
retention and expansion at existing locations. Economic development
professionals may typically have no knowledge, or only very limited
awareness, of how these potential tax savings can impact the bottom line.
The alliantgroup also provides a variety of other tax
advisory and cost reduction services
- State and local tax credits and incentives,
such as those related to capital investment projects, job creation, worker
training and other programs. This includes retroactive credit
reviews for savings which may have been missed, as well as research and
advice about the potential value and how to take advantage of available
incentives. Such programs change constantly as areas compete for new
business investment projects, business retention, and local business
- Transfer pricing strategies and work to
identify potential risk areas by analyzing the client's inter-company
transfer pricing. Assists with IRS audits and disputes.
and use tax review services (download brochure, PDF - 1.7 MB))
Scope of services - continued
- Job Training & Employment Programs
Employers may receive direct cash reimbursement for education and training
expenses of eligible employees through a federally-sponsored training
system. This system, "America's Job Network" established under the
Workforce Investment Act passed by Congress in 1998, includes programs
formerly identified under the Job Training Partnership Act - JTPA.
"America's Jobs Network" will continue to assist with services such as
classroom training, on-the-job training and basic skills training for
economically disadvantaged adults and youths, dislocated workers, and
others who face significant employment barriers, while streamlining the
training process and making it better formatted to suit the local
- Employment-Based State Tax Credits
Every state offers some form of Economic Stimulus via tax credits,
savings, or reduction in tax liabilities to assist businesses located
within their state. These programs include: Enterprise Zones, Job
Retention and Creation Tax Credit Programs, Training Credits, Investment,
Expansion, Improvement, and Real and Personal Property Exemptions. Some
states also offer incentives for child care facilities, research credits,
and environmental expenditures. In addition, the local municipality or
county may provide additional incentives.
These savings are based on a state-by-state analysis. alliantgroup's
professionals assist in procuring these government
sponsored incentives for a company:
Hiring / Job Creation Credits
Investment Tax Credit Programs
Property Tax Abatement
Community Development Block Grants
- Employment-Based Federal Tax Credits
Does your company utilize federal employment tax credits and incentives?
If not, alliantgroup can introduce you to this often overlooked
tax savings opportunity. The federal tax credits apply to new hires, and
savings are based on compensation, hours worked, and the qualifying credit(s). alliantgroup can help realize a potential tax credit
(dollar-for-dollar tax savings) of up to $2,400 for Work Opportunity Tax
Credits, up to $8,500 for Welfare-To-Work Tax Credits, and up to $3,000
for Empowerment Zone Tax Credits per eligible employee.
Federal employment tax credits are a way of getting paid to hire new
employees. Every new hire may be eligible for a tax credit. Federal
employment tax credits are dollar-for-dollar tax savings for a company
which hires employees who qualify for the following programs:
Disabled Americans / Access Tax Credits
Empowerment Zone / Renewal Community Tax Credit
Native American Tax Credits
Welfare-to-Work Tax Credit
Work Opportunity Tax Credit
|Specialties : Types of projects
Their main focus is independent work to obtain R&D tax
credit savings, particularly for small and mid-sized enterprises ( SME's)
such as middle-market manufacturing companies which may not yet be taking
full advantage of the potential. Since R&D credits may not have been
relevant to these companies in the past under the old tax rules, their
auditors may not even recognize this new potential to significantly reduce
Although they focus on small and mid-sized companies, this
work can be just as relevant to very large companies. Since they do
not compete with the external audit and tax services of public accounting
firms, this specialized work to achieve tax savings for clients is
complementary rather than a conflict with these other service providers.
Public accounting firms have directly referred their audit clients to
alliantgroup for such work.
Their work on R&D tax credits starts
with a quick discussion about whether the company has already taken full
advantage of the potential savings.
Typically there will be some uncertainty about this,
including opportunities which may have been overlooked even if the company
already obtained some R&D tax credits, so Phase I is a preliminary analysis
to invest some time at the company to identify the potential scope for tax
savings. This free assessment and feasibility work defines the
expected savings and work plan as a
non-intrusive turnkey R&D study.
This free analysis leads to the more intensive cost
analysis work to identify, document, and obtain the actual tax savings
during Phase II and III.
See their website or
credits brochure (download PDF - 1.6 MB) for details.
|Illustrative client list
Contact them directly to discuss this, as names are not
published on their website.
- They have performed hundreds of R&D tax credit studies
for clients, generating over $500 million in R&D tax credits for clients.
- They have filed over 3500 claims for refunds.
- They have served more than 1,000 private and public
|Illustrative project summaries
and benefits to clients
Information beyond the above examples
is not available at this time. Contact directly.
The benefits of the R&D tax credit work and related
services include :
dollars of tax credits, resulting in cash back from the IRS;
u Permanent tax
savings and financial statement benefits;
u Creating a
vehicle to realize additional tax savings in future years;
u Increasing the
market value, earnings power and cash flows of their Company
Reducing the overall effective tax
|Alliances with other firms
- none identified at this time
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- not available at this time
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