West Virginia Application for West Virginia Strategic Research and Development Tax Credit

Application for West Virginia Strategic Research and Development Tax Credit
Form SRDTCA
SRDTC-A
REV 12-11

Application for

West Virginia Strategic Research and Development Tax Credit

for Qualified Expenditures and Qualified Investments Placed in Service On or After January 1, 2003

Name

Identification Number

Business Name

Tax Year
_______________, ____________ to _______________, ____________

Street Address

City, Town, or Post Office

State

Zip Code

Application is hereby made to the West Virginia State Tax Commissioner for allowance of Strategic Research and Development Tax Credit with
respect to qualified expenditures incurred during Applicant’s tax year ending.

MM

/

DD

/

YYYY

1. Base amount of research and development in West Virginia:
a. Qualified research and development expenditures in preceding year:

a. $

b. Qualified research and development expenditures two years ago:

b. $

c. Qualified research and development expenditures three years ago:

c. $

2. Business Activity in West Virginia:
a. North American Industry Classification System Code (NAICS)
b. Narrative Description of Qualified Research and Development Activity in West Virginia

Total Investment

3a. Investment:
$

Qualified Investment
$

3b. Location(s) of investment in West Virginia

3c. General description of qualified investment:
Narrative:

FORM WV/SRDTC (Rev. 12/11)
APPLICATION FOR WEST VIRGINIA STRATEGIC RESEARCH AND DEVELOPMENT TAX CREDIT

Page 1 of 4

4.

A. New products, equipment, processes, techniques, formulas, inventions or computer software:
What new products, equipment, processes, techniques, formulas, inventions, or computer software are intended to result from the research,
that will be held by the Taxpayer for sale, lease, or licenses by the Taxpayer, or used by the Taxpayer in a trade or business of the Taxpayer?

B. Processes, machinery and techniques for commercial production:
What new plant processes, machinery, or techniques for commercial production of new products, processes, techniques, formulas,
inventions, or computer software are intended to result from the research, that will be held by the Taxpayer for sale, lease, or license by the
Taxpayer, or used by the Taxpayer in a trade or business of the Taxpayer?

C. Improvements to existing products, equipment, plant processes, techniques, formulas or machines:
If the research relates to improvement of an existing product, equipment, plant process, technique, formula or machine, specifically describe
the new or improved function, performance, reliability or quality that is intended to result from the research.

D. Problem intended to be resolved by research:
What is the problem that is intended to be solved by the research?

Describe why resolution of the problem is important.

Describe what will be different if the research is successful in resolving or addressing the problem.

E. Nature, methodology, line of inquiry:
Does the proposed research activity qualify for the Federal Research and Development Credit?

Yes

No

Describe in general terms the methodology or line of inquiry to be initially followed by which the purposes of the research are to be
accomplished or the problem is to be solved.

FORM WV/SRDTC (Rev. 12/11)
APPLICATION FOR WEST VIRGINIA STRATEGIC RESEARCH AND DEVELOPMENT TAX CREDIT

Page 2 of 4

In general terms, what scientific or technical areas of inquiry will be dealt with in the research project? For example: biology, biochemistry,
chemistry, computer science, electronics, mechanics, medicine, immunology, mining technology, drilling technology, pharmacology, aviation
and aerospace technology, manufacturing, transportation technology, automotive technology, tools and tooling, power generation, utility
delivery systems, communications technology, etc.?

Is the research to be undertaken for the purpose of discovering information that relates to the
practical application of scientific or engineering knowledge in a specialized area

Yes

No

Will the research activities substantially constitute elements of a process of experimentation

Yes

No

F. Project costs, accounting and logistics:
Projected time-line for the research program or project:

/

/

to

/

/

Time period over which the Taxpayer seeks to have the project certified for purposes of the West
Virginia Strategic research and development tax credit.

/

/

to

/

/

Estimated annual projected budget over the projected time-line

$

Number and types of jobs created as a direct result of the research and
development program.

Type of Job Created

Estimated average wages and benefits to be paid to employees in jobs created
as a direct result of the research and development program
$

Number

Average Wages

Benefits
$

Will the Taxpayer have the legal right and entitlement to use and posses the research results?

Yes

No

Does the Taxpayer bear the expense of the research without regard to whether the research is
successful or unsuccessful?

Yes

No

Will the Taxpayer be entitled to the federal income tax deduction for research expenses under
section 174 of the Internal Revenue Code for research expenses incurred in the project?

Yes

No

Does the Taxpayer intend to apply for a patent or copyright on the products, processes,
techniques, formulas, inventions, computer software, plant processes, machinery, or techniques
that may result from the research?

Yes

No

5. Qualified Research and Development Expenditures
a. Qualified in-house wages paid for West Virginia Research and Development

a. $

b. Qualified in-house supply expenditures for West Virginia Research and
Development

b. $

c. Qualified in-house expenditures paid to others for right to use personal
property for qualified West Virginia Research and Development

c. $

d. Contract research and development expenses incurred in West Virginia for
qualified Research and Development

d. $

FORM WV/SRDTC (Rev. 12/11)
APPLICATION FOR WEST VIRGINIA STRATEGIC RESEARCH AND DEVELOPMENT TAX CREDIT

Page 3 of 4

6.

Payroll

Employment:

Jobs

a. Total WV payroll and number of jobs prior to research and development
expenditures:
b. Total WV payroll and number of jobs this tax year:
7.

Benefits:

%

a. Percentage of employees covered under health plans:
b. Average annual health plan benefit cost per employee:

$
%

c. Percentage of employees covered under retirement plan:
d. Average annual retirement benefit cost per employee:

$

Under penalties of perjury, I declare that I have examined this credit claim form (including accompanying schedules and
statements) and to the best of my knowledge it is true and complete.

Signature of Taxpayer

Name of Taxpayer (type or print)

Person to contact concerning this return

Signature of Preparer other than Taxpayer

Title

Date

Telephone Number

Address

Date

Please return the completed application to:
West Virginia State Tax Department
PO Box 11275
Charleston, WV 25339-1275
If you have any questions or need further information regarding this application, telephone (304) 558-3333 or toll free to
1-800-WVA-TAXS (1-800-982-8297)

FORM WV/SRDTC (Rev. 12/11)
APPLICATION FOR WEST VIRGINIA STRATEGIC RESEARCH AND DEVELOPMENT TAX CREDIT

Page 4 of 4

SCHEDULE WV/SRDTC-A
APPLICATION FOR WEST VIRGINIA STRATEGIC RESEARCH AND DEVELOPMENT TAX CREDIT
FOR EXPENSES OR INVESTMENTS PLACED IN SERVICE ON OR AFTER JANUARY 1, 2003
Information & Instructions
The Strategic Research And Development Tax Credit (R&D)
is available to a Taxpayer engaging in qualified research and
development activities (on or after January 1, 2003) within West
Virginia.
Research and development means systematic scientific, engineering
or technological study and investigation in a field of knowledge in
the physical, computer or software sciences, often involving the
formulation of hypotheses and experimentation, for the purpose of
revealing new facts, theories or principles, or increasing scientific
knowledge, which may reveal the basis for new or enhanced
products, equipment or manufacturing processes.
Research and development includes, but is not limited to,
design, refinement and testing of prototypes of new or improved
products or equipment or the design, refinement and testing of
manufacturing processes before commercial sales relating thereto
have begun. The term, commercial sales, includes, but is not limited
to, sales of prototypes or sales for market testing.
Research and development does not include: market research;
sales research; efficiency surveys; consumer surveys; product
market testing; product testing by product consumers or through
consumer surveys for evaluation of consumer product performance
or consumer product usability; the ordinary testing or inspection
of materials or products for quality control; management studies;
advertising; promotions; the acquisition of another’s patent, model,
production or process or investigation or evaluation of the value or
investment potential related thereto; research in connection with
literary, historical or similar activities; research in social sciences,
economics, humanities or psychology and other non-technical
activities; and the providing of sales services or any other service,
whether technical service or non-technical service.
Qualified research and development credit property means
depreciable property purchased for the conduct of qualified
research and development. Qualified research and development
expenses means the sum of in-house and contract research and
development expenses for qualified research and development
allocated to West Virginia, which are paid or incurred by the
eligible Taxpayer during the taxable year. These expenses do not
include any expense that must be capitalized and depreciated for
federal income tax purposes, or any expenditure paid or incurred
for the purpose of ascertaining the existence, location, extent or
quality of any deposit of coal, limestone or other natural resource,
including oil and natural gas. In addition, these expenses do not
include any wage or salary expense for wages or salary reported
on form W-2 for federal income tax purposes on which the West
Virginia personal income tax is imposed, and against which tax the
Strategic Research And Development Tax Credit is applied.
Rev. 12/11

The allowable tax credit is the greater of three percent [3.0%] of the
annual combined qualified research and development expenditure
within West Virginia, or ten percent [10.0%] of the excess of the
annual combined qualified research and development expenditure
within West Virginia over the base amount. The base amount
equals the average annual combined research and development
expenditure within West Virginia during the three years preceding
the current year.
For a taxpayer that has filed a WV Business Franchise tax
return for 1 or 2 prior taxable years (but fewer than 3 taxable
years), determined on the basis of all filings by the Taxpayer’s
controlled group, the base amount is the average annual combined
qualified research and development expenditure for the number
of immediately preceding taxable years, other than short taxable
years, during which the taxpayer filed a WV Business Franchise
tax return.
For a Taxpayer that has not filed a WV Business Franchise tax
return for at least 1 taxable year, determined on the basis of all
filings by the taxpayer’s controlled group, the base amount is zero.
By Law, no credit may be allowed or applied for any qualified
investment property placed in service until the person asserting
a claim for the credit makes written application to the Tax
Commissioner. Failure to timely apply for credit will result in
forfeiture of 100% of the annual credit allowance otherwise
available under this requirement. Form SRDTC-A is designed to
be a general application form for taxpayers wishing to claim credit
based upon research expenses and research investments placed into
use or service on or after January 1, 2003. The timely filing of this
application is a condition precedent to claiming tax credits. This
application must be filed for each year, in which qualified research
and development expenses or investments are to be made, no later
than the due date of the Taxpayer’s West Virginia income tax
return for the year the expense is incurred or the investment is
made, including any legally granted extension of time for filing
such returns.

INSTRUCTIONS TO FORM SRDTC-A
Base Amount of Research and Development in West
Virginia:
Enter the amount of annual qualified research and development
expenditure, if any, in West Virginia for the three taxable years
immediately preceding the taxable year for this application form
as follows. [Note that for years prior to 2003, the amounts entered
below should represent the qualified expenditure made under the
assumption that the Strategic Research and Development Tax
Credit had been in place at that time.]

1

1

a.

Enter the amount of annual qualified research and
development expenditure in West Virginia during the
immediately preceding tax year.

b.

Enter the amount of annual qualified research and
development expenditure in West Virginia during the tax
year two years preceding the current year (i.e. two years ago).

c.

2

Enter the amount of annual qualified research and
development expenditure in West Virginia during the tax
year three years preceding the current year (i.e. three years
ago).
Business Activity in West Virginia:
a.

b.

Enter the North American Industry Classification System
Code that most closely describes your business activity in
West Virginia.
Describe in detail the nature of your research and
development activity in West Virginia.

Investment: Enter the total dollar amount of investment
placed into service or use in the first column and the
dollar amount of qualified investment placed into service or use in
the second column. Qualified Investment is determined according
to the following useful life table (straight line depreciation):

3a

USEFUL LIFE

4
5
a.
b.
c.

d.

6
a.

At Least

But Less Than

Percent Qualified

b.

4

6 years

66-2/3

7

0

6 or more years

4 years

33-1/3
100

Enter the location(s) of the qualified investment property
(i.e. Main Street, Weston, or 12 miles north of Pipestem
at the Intersection of State Route 3 and State Route 20).

3b

Provide a general description of the qualified investment
property in the space provided (i.e. $100,000 to be
invested in buildings, $500,000 to be invested in machinery and
equipment, etc.)

3c

a.
b.
c.
d.

Provide Written Information On The Research And
Development Plan.
Qualified Research and Development Expenses:
Enter the total amount of your qualified in-house wages
paid for research and development within West Virginia.

Enter the total amount of your qualified in-house
expenditures for supplies for use in research and development
in West Virginia.
Enter the total amount of your qualified in-house
expenditures paid to another person for the right to
use personal property in the conduct of research and
development in West Virginia.

Enter the total amount of contract research and development
expenses incurred in West Virginia for qualified research
and development in West Virginia.
Employment:
Enter your total West Virginia payroll and number of
jobs attributed to that payroll for the prior year (i.e.,
twelvemonth period) before the incurrence of this year’s
qualified expenditures subject to Strategic Research and
Development Tax Credit.
Enter your total West Virginia payroll and number of jobs
for the current year.
Benefits:
Enter the percentage of your employees covered under your
sponsored health insurance plan.

Enter the average annual cost of your employer-provided
health insurance benefits (i.e., benefit costs divided by
number of covered employees).
Enter the percentage of your employees covered under your
retirement plan.

Enter the average annual retirement benefit contribution
cost per covered employee.

The timely filing of this application and project approval are required for the Applicant to begin claiming Strategic Research and
Development Tax Credit benefits. Filing of the application will not bar or otherwise prevent the Tax Commissioner from auditing
or examining the Applicant’s books and records for compliance with the Strategic Research and Development Tax Credit law and
regulations or other West Virginia tax provisions.

This application must be signed by an officer of the company to be valid.
If you have questions concerning this publication, please contact:
West Virginia State Tax Department
Compliance & Taxpayer Services Division
Post Office Box 3784
Charleston, West Virginia 25337-3784
Telephone: (304) 558-3333 or
Toll free: 1-8000-WVA-TAXS (1-800-982-8297)
TDD Service for the hearing impaired: 1-800-2TAXTDD (1-800-282-9833)
To order forms or publications call: (304) 344-2068 or toll free 1-800-982-8297

Rev. 12/11

t

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