The Chief Counsel Advice Memo issued in October of 2021 significantly changed the documentation requirements for any amended R&D tax credit claims submitted after January 10, 2022. The changes are listed below:
Identify all the business components to which the I.R.C. § 41 research
credit claim relates to that year.For each business component:
identify all research activities performed;
identify all individuals who performed each research activity; and
identify all the information each individual sought to discover.
Provide the total qualified employee wage expenses, total qualified supply
expenses, and total qualified contract research expenses for the claim
year (this may be done using Form 6765, Credit for Increasing Research
Activities).
This information must be submitted with the amended tax return, and failure to do so can result in a denial of the claim. The IRS does give taxpayers a period of 45 days to perfect their claim if it has been rejected.
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