The IRS said Oct. 1 that it wants to receive additional feedback about the draft instructions for Form 6765 and is extending the dates for certain reporting requirements related to the Credit for Increasing Research Activities, commonly known as the research tax credit.
After publishing drafts of Form 6765 and its related instructions last year, the IRS was asked by stakeholders to provide more time to share feedback. As a result, the agency decided to extend the comment period for the draft instructions through March 31, 2026. The decision was made “to alleviate taxpayer burden and in the interest of fair and effective tax administration,” the IRS said in a media release.
Interested parties can submit feedback about the Form 6765 instructions to lbi.rt.team@irs.gov, using the subject line: “Instructions for Form 6765.” The IRS said it expects to release a revised Form 6765 instructions for tax year 2025 (processing year 2026) this coming January.
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The IRS said that Section G of Form 6765 will be optional for all filers for tax year 2025.
For tax year 2026 (processing year 2027) and beyond, Section G will be mandatory for all filers with optional reporting for:
- Qualified small business taxpayers, defined in Section 41(h)(3) of the Internal Revenue Code, who check the box to claim a reduced payroll tax credit; or
- Taxpayers with total qualified research expenses equal to or less than $1.5 million, determined at the control group level and equal to or less than $50 million of gross receipts, as determined under Section 448(c)(3) (without regard to subparagraph (A) thereof), claiming a research credit on an original filed return.
The IRS also is extending the research credit claim transition period, which gives taxpayers 45 days to perfect a research credit claim for refund prior to the IRS’s final determination on the claim, through Jan. 10, 2027, the agency said.
To submit a claim for refund for the research credit postmarked after June 18, 2024, that is sufficient for the IRS to consider, taxpayers must:
- Identify all the business components to which the Section 41 research credit claim relates for that year;
- Identify all research activities performed for each business component; and
- Provide the total qualified employee wage expenses, total qualified supply expenses, and total qualified contract research expenses for the claim year. Taxpayers may use Form 6765, Credit for Increasing Research Activities, for this purpose.
The IRS previously announced the release of draft Form 6765, Credit for Increasing Research Activities, on June 12, 2024. The agency then released draft Instructions for Form 6765 on Dec. 20, 2024.
More information about the research credit can be found here.
Photo credit: hapabapa/iStock
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