Instructions For Form 6765 - Credit For Increasing Research Activities

Form 6765 (2008)

Page

General Instructions

In addition, substantially all of the

Member of

activities of the research must be

Controlled Group or

Section references are to the Internal

elements of a process of

Business Under

Revenue Code unless otherwise

experimentation relating to a new or

Common Control

noted.

improved function, performance,

reliability, or quality. The research

For purposes of figuring the credit, all

What’s New

credit generally is not allowed for the

members of a controlled group of

following types of activities.

The general credit rate for the

corporations (as defined in section

alternative simplified credit increased

41(f)(1)(A) and (f)(5)) and all members

Research conducted after the

from 12 percent to 14 percent.

of a group of businesses under

beginning of commercial production.

common control (as defined in section

The alternative incremental credit in

Research adapting an existing

41(f)(1)(B)), are treated as a single

Section B will terminate for tax years

product or process to a particular

taxpayer. As a member, compute your

beginning after December 31, 2008.

customer’s need.

credit based on your proportionate

The current year credit must be

Duplication of an existing product or

share of qualified research expenses

reduced by the amount (if any) of the

process.

and basic research payments giving

credit for employer differential wage

rise to the group’s research credit for

Surveys or studies.

payments.

Section A, B, or C. Enter your share of

Research relating to certain

the credit on line 17, 42, or 59,

Purpose of Form

internal-use computer software.

whichever applies. Attach a statement

Use Form 6765 to figure and claim the

Research conducted outside the

showing how your share of the credit

credit for increasing research

United States, Puerto Rico, or a U.S.

was figured, and write “See Attached”

activities.

possession.

next to the entry space for line 17, 42,

or 59.

Research in the social sciences,

Who Must File

For special rules regarding the

arts, or humanities.

An individual, estate, trust,

election (or revocation of the election)

Research funded by another person

organization, or corporation claiming a

of the alternative incremental credit in

(or governmental entity).

credit for increasing research activities;

Section B by a controlled group of

or any S corporation, partnership,

If you incur qualified clinical testing

corporations, see Regulations section

estate, or trust that allocates the credit

expenses relating to drugs for certain

1.41-8.

to its shareholders, partners, or

rare diseases, you can elect to claim

Specific Instructions

beneficiaries must complete this form

the orphan drug credit for these

and attach it to its income tax return. If

expenses instead of the research

you are a taxpayer that is not a

You can:

credit. See Form 8820, Orphan Drug

partnership or S corporation, and your

Credit.

Claim the regular credit in

only source of this credit is from a

See section 41 and Regulations

Section A,

partnership, S corporation, estate, or

sections 1.41-2 and 1.41-4 for other

Elect the alternative incremental

trust, you are not required to complete

definitions and special rules.

credit in Section B, or

or file this form, with the following

Special Rules

exception: you are a taxpayer that is an

Elect the alternative simplified credit

estate or trust and the credit can be

in Section C.

See section 41(f) and Regulations

allocated to beneficiaries. For more

You may want to figure your credit

sections 1.41-6, 1.41-6T, and 1.41-7

details, see the Instructions for Form

for special rules related to:

using all of the methods for which you

1041, Schedule K-1, box 13.

are eligible to get the maximum credit

Aggregation of expenditures for

allowed.

Note: Corporations filing an amended

members of controlled groups and

return to claim a refund of the

Once elected, the alternative

businesses under common control;

research credit, see Notice 2008-39,

incremental credit or the alternative

Allocation of the credit by

I.R.B. 2008-13 684, available at

simplified credit applies to the current

partnerships, estates, and trusts;

tax year and all later tax years, unless

index.html for information on where to

Adjustments, if a major portion of a

you revoke the election. The

file.

business is acquired or disposed of;

revocation for the alternative

and

incremental credit must be made on

Qualified Research

an original return filed by the due date

Short tax years.

The research credit is generally allowed

(including extensions). See Regulations

For special rules concerning the

for expenditures paid or incurred for

section 1.41-8T. The revocation of the

allocation and apportionment of

qualified research. Qualified research

alternative incremental credit may not

research and experimental

means research for which expenditures

be made on an amended return. To

expenditures between U.S. and

may be treated as section 174

revoke a previous election of the

foreign source income, see sections

expenses. This research must be

alternative incremental credit,

861 through 864.

undertaken for discovering information

complete Section A or C.

that is technological in nature, and its

Section A—Regular Credit

application must be intended for use in

developing a new or improved

Skip this section and go to Section B

business component of the taxpayer.

or C if:

Instructions For Form 6765 - Credit For Increasing Research Activities - 2008

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