Recommendations

Six proposals to the US federal government on how research credit claims are prepared, priced, identified and reviewed.

These proposals are the position of Swanson Reed, the publisher of this site.

These six proposals are addressed to the US federal government only: Congress, Treasury and the IRS. They are consistent with Swanson Reed's central position that Congress should prohibit contingent fees in federal R&D tax credit engagements under Section 41. None of these proposals is an alternative to a prohibition. Each is intended to work alongside it. Two concern fees: disclosing the fee basis on the claim itself, and limiting contingent fees for amended returns and refund claims as the part of that prohibition that can be acted on first. Two concern accountability: naming the preparer and the technical reviewer on every claim, and making preparers share the consequences of a claim they knew or should have known was excessive. One sets minimum professional standards for anyone preparing a research credit claim for a fee. The last asks for regular publication of aggregate data on claims, reviews and adjustments. Each page states the problem, the proposal, who would act, the expected effect and the main objections, with sources.

In this section

Proposal 1
Fee disclosure on the claim
When a business files a federal research credit claim, it should state how the person who prepared the claim was paid. Form 6765 is the natural place to ask.
5 min read
US
5 min read
Proposal 2
Limits on contingent fees for refund claims
Congress should restore and extend, by statute, the restriction on contingent fees for amended returns and refund claims that include the federal research credit, as the first part of a full prohibition on contingent fees in Section 41 engagements.
5 min read
US
5 min read
Proposal 3
Preparer identification
Every federal research credit claim should name the person who prepared the credit calculation and the person who reviewed its technical basis, not only the preparer who signs the return.
5 min read
US
5 min read
Proposal 4
Shared responsibility for overclaims
When a research credit claim is excessive and the preparer knew or should have known it, the preparer's exposure should reflect the size of the overclaim, not only the fee earned.
6 min read
US
6 min read
Proposal 5
Professional standards for claim preparers
Anyone who prepares a federal research credit claim for a fee should meet minimum standards of competence, diligence and conduct, whatever their professional background.
5 min read
US
5 min read
Proposal 6
Data and reporting
The IRS should publish regular aggregate data on federal research credit claims, the reviews it carries out and the adjustments that result, so that the debate on how claims are prepared can rest on evidence.
5 min read
US
5 min read

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