Adjustments sought for R&D Tax Credit Form


There are changes coming to certain sections of Form 6765, Credit for Increasing Research Activities—the document used by taxpayers to claim the research and development tax credit.

The IRS unveiled the new version of the form so that it could solicit feedback from stakeholders in advance of the formal draft release process. For now, some of the proposed changes address previous feedback the agency received from taxpayers and tax professionals. The plan is to make the changes effective beginning with tax year 2024.

The proposed changes to Form 6765 include:

  • A new Section E with five questions seeking miscellaneous information
  • A new Section F for reporting quantitative and qualitative information for each business component, required under Section 41 of the Internal Revenue Code
  • Moving the “reduced credit” election question and the “controlled groups or businesses under common control” question from line 17 and line 34 to the top of Form 6765

In addition, the IRS also is requesting feedback on whether Section F should be optional for certain taxpayers, including those qualified research expenditures less than a certain dollar amount at a controlled group level; with an R&D credit less than a certain dollar amount at a controlled group level; and those of which are a qualified small business for the payroll tax credit.

Feedback for each suggestion should address the justification, limitation amounts, and pros and cons, the IRS said.

If Section F were optional for certain taxpayers, the IRS said it would not affect the requirement to maintain books and records and to provide Section F information in similar format, if requested. Also, it would not apply to amended returns for the R&D credit.

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