Here are some of the salient details about this IRS tax credit program that incentives and rewards companies who upgrade their websites with certain features.
The first qualification is that the tax credit is only available to specific small businesses defined as:
- Annual revenues of less than $1 million, or
- Employ fewer than 30 full-time employees
This program is available to manufacturers, professional services providers, retailers and distributors to name just a few qualifying businesses. They can be located anywhere in the U.S.A.
How does this IRS tax credit work once you qualify?
The IRS guidelines in this program say that any expenses incurred in your qualifying website upgrade are eligible for a 50% credit for any expenditures over $250, not to exceed $10,250, for a maximum benefit of $5,000.
The way the credit works is when you fill out your company tax return, you fill out an additional form (with your return) and you deduct the amount of the credit you are claiming from the tax you owe.
So if your tax liability is $12,000 and spent $15,000 on a qualifying website upgrade, you will have hit the maximum credit of $5,000 which can be used to reduce your tax bill from $12,000 down to $7,000.
Note: We are not tax experts and recommend that companies applying for this unique credit confirm eligibility with their Tax Advisor.
If you want more details to see what is considered a qualifying website upgrade, please fill out the form below.