“R&D nexus: Who worked on what?” in Accounting Today

Field auditors examining taxpayer claims for research and development credits are pursuing a relatively new line of questioning: “What’s your nexus?”

Common in other areas of tax, the concept of nexus is a sticking point in audits for R&D credits. Nexus refers to the connection between a qualified activity (business component) and its qualifying expense. The IRS wants to see in documentation the direct connection between the qualified wages a taxpayer claims and the qualifying business component they spent it on. Often this comes down to proving who worked on what.

Read more at Accounting Today: R&D nexus: Who worked on what?

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Jamie Overberg can be reached at joverbert@taxops.com. Follow Judy On LinkedIn.

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