DESCRIPTION
This module examines the technical framework and strategic application of tax credits in reducing overall tax liability. Participants analyze common individual and business credits, focusing on eligibility requirements, limitations, and compliance considerations. The course emphasizes the mechanics and computation of credits such as the Research and Development (R&D) credit and the Section 196 deduction for expired credits, while providing an overview of the Work Opportunity Tax Credit. Through computational exercises and group discussion, participants reinforce key concepts and explore planning considerations. Overall, the module builds practical skills for accurate credit analysis and strategic tax optimization.
LEARNING OBJECTIVES
- Explain the purpose and mechanics of tax credits and their impact on reducing tax liability.
- Identify and differentiate common individual income tax credits based on eligibility requirements and limitations.
- Apply general business credit rules, including limitations and carryforward provisions, to calculate allowable credits.
- Compute the Section 196 deduction for expired Internal Revenue Code Section 38 credits, including applicable limitations and ordering rules.
- Explain the fundamentals of the Research and Development (R&D) Tax Credit, including the definition of qualified research activities, and compute the credit.
