Emergency-related state tax relief available for taxpayers located in two counties of Michigan impacted by severe weather.
Base Amount Example: One Year Had No MQREs
Base Amount Example: One Year Had No MQREs
Example Explanation
A business is applying for the Research and Development (R&D) Tax Credit in Year 8 and needs to calculate its base amount to determine eligibility:
- Determine MQREs for the three prior calendar years:
- Year 5: $0
- Year 6: $15,000
- Year 7: $25,000
- Add the MQREs from the years with expenses.
- $15,000 + $25,000 = $40,000
- Divide the total by the number of years with MQREs.
- $40,000 ÷ 2 = $20,000
To Qualify For the Credit
To qualify for the R&D Tax Credit in Year 8, the business’s MQREs must exceed its base amount of $20,000.