The professionals of Maurer, Gittings & Graf, LLP have decades of experience in claiming and identifying tax incentives and credits.  We've developed a reputation for quality, timeliness and thoroughness in assisting clients in documenting and claiming various federal and state credits and incentives.  We have the expertise to maximize the utilization of the credits at both the entity and owner level.  Through cutting edge technology and resources we have the experience and expertise to maximize your refunds and future credit utilization.

Federal Tax Credits

From a federal perspective, Maurer, Gittings & Graf, LLP can assist you in identifying and utilizing all credits that your company qualifies for and will help you achieve maximum utilization.  Some of the credit programs available include: Research and Development, WOTC/Wtw, Propane or Alternative Fuel Credits, Empowerment Zone, etc.

Maurer, Gittings & Graf, LLP's tax advisors are experts in identifying and helping clients claim these credits.  If you are interested in a thorough analysis of any of these tax credit studies please do not hesitate to give our office a call.

Research Credits

Tax Credits are an immediate source of cash, as well as a significant reduction to current and future years' federal and state tax liabilities.  Many business owners in nearly every industry are unaware that federal and state research and development (R&D) tax credit programs exist that may reward their day-to-day efforts aimed at producing an improved product. 


The  Research and Development Tax Credit is a government-sponsored benefit that provides cash incentives for companies conducting R&D in the U.S. These economic incentives were implemented to stimulate research and development in industries of all sizes, to encourage companies to work together, and to transform the economic landscape.

The Research & Development (R&D) tax credit is for businesses of all sizes, not just major corporations with research labs, and many companies are surprised that they qualify. If you think you must have research labs with white-coated scientists to qualify, think again. 


Any company that designs, develops, or improves products, processes, techniques, formulas, inventions, or software may be eligible. In fact, if a company has simply invested time, money, and resources toward the advancement and improvement of its products and processes, it may qualify.

The R&D tax credit and other related tax breaks save U.S. businesses billions annually.

Even better, under recently issued government regulations, more industries now qualify for the R&D tax credit than ever before. Plus, the R&D tax credit regulations allow eligible taxpayers to “look back” to all open tax years (typically three years plus the current year) for potential Research credits that were never claimed.

Contact our offices to learn more about the R&D Tax Credit.  Additional information can be viewed here:

https://www.mggllp.com/R&D%20Credits.php

Propane Credits

HR5771 the Tax Increase Prevention Act of 2014 just signed by President Obama makes retroactive to January 1, 2014 the 50 cent per gallon alternative fuel tax credit and alternative fuel mixture tax credit. This credit is commonly applicable for taxpayers who use propane or liquefied petroleum gas to fuel vehicles not required to be registered for highway use, e.g. forklifts.

If you aren’t familiar with this 504 credit, below is a recap of how the credit works:

As you probably know, propane used in forklifts is exempt from the Federal Excise Tax.

The Internal Revenue Service (IRS) has made it clear that under the terms of P.L. 109-59, the Safe, Accountable, Flexible and Efficient Transportation Equity Act of 2005 (referred to as the Highway Bill) that forklifts fit the definition of an off-highway business motor vehicle and hence, propane used in a forklift is eligible for the 50 cent per gallon tax credit.

PROPANE USED IN A FORKLIFT IS ELIGIBLE FOR THE 50 CENT PER GALLON TAX CREDIT

This is a huge benefit, assuming you took appropriate steps to properly register with the IRS. 

As a first step, forklift operators must file a Form 637 with the IRS in order to become registered as an “Alternative Fueler”. IRS will then issue a registration number identifying the forklift operator as an Alternative Fueler. After receiving a registration number, the forklift operator can file a claim for the credit at the end of the year by filing Form 4136.  Please contact our office for additional information.

Summary of California State Tax Credits and Incentives

California Partial Sales Tax Exemption

California Full Sales and Use Tax Exclusion Program

  • Provides full exemption on sales and use tax for advanced manufacturers and manufacturers of alternative source and advanced products, components or systems.
  • Full exemption subject to state approval.
  • Defines advanced manufacturing processes as manufacturing that improves existing or creates entirely new materials, products and processes through the use of science, engineering or information technologies, high-precision tools and methods, a high-performance workforce and innovative business or organization models in utilizing any of the following technology areas: micro and nano-electronics, including semiconductors, advanced materials, integrated computational materials engineering, additive manufacturing or industrial biotechnology.
  • For more information and to apply for approval: http://www.treasurer.ca.gov/caeatfa/ste/index.asp

California Research & Development Credit

  • Reduces income or franchise tax.
  • Receive credit if you paid or incurred qualified research expenses while conducting qualified research in California.
  • Credit is 15% of the excess of current year research expenditures over a computed base amount (minimum of 50% of current year research expenses).
  • Corporations may be eligible for the “basic research” credit, which is equal to 24% of the excess of basic research payments paid or incurred during the year over the base period amount.
  • Credit is claimed on the return for the taxable year you incurred the qualified expenses.
  • For more information: www.ftb.ca.gov/forms/misc/1082.pdf   

California Competes Tax Credit

  • The program has 4 phases.
  • Tax credit agreements are negotiated by the Governor’s Office of Business & Economic Development (GO-Biz).
  • Tax credits remaining in 2015: $31.1 million plus any unallocated amounts from the previous application periods ($150 million total for 2014-15 fiscal year).

New Employment Credit (NEC)

  • Hiring credit is available for businesses located in a Designated Geographic Area (DGA), or census tracts with the 25% highest share of both unemployment and poverty in the state.
  • 35% credit of qualified wages between $13 and $31.50 an hour for 5 years for qualified new hires.
  • Employee qualifications:
  • Persons unemployed 6 months
  • Veterans within 1 year of separation
  • EITC recipients
  • Ex-offenders and recipients of CalWorks or general assistance.
  • Employee can continue to generate credits for 60 months from the original date of hire.
  • Credit can only be claimed by taxpayers that provide a net increase in jobs from year to year.
  • For more information: https://www.ftb.ca.gov/online/New_Employment_Credit_Reservation/

Employment Training Panel (ETP)

  • Provides funding to employers to assist in upgrading skills of their workers through training that leads to good paying, long-term jobs.
  • Employers make decisions about their training program, ETP provides the funds.
  • Range of reimbursements from $18 to $26 per training hour per employee.
  • Calculation of funds earned depends on number of trainees and training hours.
  • No penalty to employer if training is not delivered as estimated.
  • Classroom or laboratory training may be outsourced to a subcontracted vendor, instructed by internal company personnel, or by certain kinds of computer-based training.
  • Qualified employee participants:
  • Employed full-time (at least 35 hours per week)
  • Earning the EPT minimum wage of $15.70 or more per hour (including medical, dental, and vision benefits)
  • Remain on the job for 90 days after completing training
  • Length of training: minimum 24 hours with a maximum of 200 hours per attendee
  • For more information: www.ept.ca.gov

Work Opportunity Tax Credit – Veterans (WOTC)

  • Although WOTC ended on December 31, 2014, IRS just published a notice of transition relief for the program. Employers now have additional time to submit their requests for 2014 WOTC certification. The relief period allows employers to submit WOTC certification requests until April 30, 2015, if they hired a member or a targeted group between January 1, 2014 and December 31, 2014.

Transitional Subsidized Employment (TSE)

  • Provides entry-level workers for your business that you do not have to pay wages, employment taxes and Workers Compensation Insurance at 30-40 hours per week for 2 months
  • You interview and choose eligible workers referred from the DPSS GAIN program.
  • On month three, you hire the worker.  Then your business becomes eligible for a subsidy payment of $550 per worker, per month, if the worker works full time. The subsidy payment is available in three through six only.

Los Angeles - Use Tax Rebate

  • Offers rebate of 20% on the additional Use Tax collected by California State Board of Equalization for the City of Los Angeles.
  • Businesses that pay Use Tax to lessors or out-of-state vendors are eligible.
  • Equivalent to about 67.5% of the 1% of the Use Tax allocated to the City of Los Angeles that you pay to your vendor.

Free Benefit Assessment

Maurer, Gittings & Graf, LLP offers a free benefit assessment to help determine if your company qualifies for any of the above tax credits and incentives and to estimate the tax savings that can be obtained.

For more information or to schedule a meeting contact one of our tax professionals at (714) 937-3900 or info@mggllp.com.