Tax Controversy.
(R&D Representation)
ABOUT
Understanding Examination Notices For R&D Tax Credits.
Each year, thousands of businesses face tax controversy cases with the IRS, or the state revenue service, an experience that can be both stressful and time-consuming. At BDC, our tax controversy representation focus is specifically on R&D Tax Credit–related controversies, which arise when businesses claim the Research & Development Tax Credit under IRC Section 41 using Form 6765.
Once submitted, these filings are reviewed by an IRS examiner who conducts a comprehensive evaluation to verify eligibility and the accuracy of claimed credits. If errors, missing documentation, or unusual claim patterns are identified, the IRS may flag the filing and issue a Notice of Examination, typically sent as Letter 566, Letter 915, or an Information Document Request (IDR).
If your business receives one of these notices, it’s critical to respond promptly, accurately, and effectively. The IRS often requests extensive documentation including project narratives, payroll records, expense data, and technical substantiation to confirm that the credit claim is valid. Failure to provide adequate support can result in partial or full disallowance of the credit, as well as penalties or accrued interest.
While not every examination escalates to a full audit, the process is time-sensitive and demands careful management. It’s imperative to defend your credit claims with experienced tax counsel and R&D specialists who understand both the technical and procedural aspects of IRS examinations. Proper representation can make the difference between a successful resolution or a costly outcome.
ABOUT
Understanding Examination Notices For R&D Tax Credits.
Each year, thousands of businesses face tax controversy cases with the IRS, or the state revenue service, an experience that can be both stressful and time-consuming. At BDC, our tax controversy representation focus is specifically on R&D Tax Credit–related controversies, which arise when businesses claim the Research & Development Tax Credit under IRC Section 41 using Form 6765.
Once submitted, these filings are reviewed by an IRS examiner who conducts a comprehensive evaluation to verify eligibility and the accuracy of claimed credits. If errors, missing documentation, or unusual claim patterns are identified, the IRS may flag the filing and issue a Notice of Examination, typically sent as Letter 566, Letter 915, or an Information Document Request (IDR).
If your business receives one of these notices, it’s critical to respond promptly, accurately, and effectively. The IRS often requests extensive documentation including project narratives, payroll records, expense data, and technical substantiation to confirm that the credit claim is valid. Failure to provide adequate support can result in partial or full disallowance of the credit, as well as penalties or accrued interest.
While not every examination escalates to a full audit, the process is time-sensitive and demands careful management. It’s imperative to defend your credit claims with experienced tax counsel and R&D specialists who understand both the technical and procedural aspects of IRS examinations. Proper representation can make the difference between a successful resolution or a costly outcome.
CONSIDERATIONS
Why It Matters.
When the IRS challenges an R&D tax credit claim, when initially claimed or at random future audits, it can feel intimidating and worst case scenarios are quickly imagined. Receiving a notice or examination letter doesn’t automatically mean your claim is invalid; it simply means the IRS is asking for proof. Too often, businesses panic, surrender their credits prematurely, or procrastinate, and fail to respond effectively leaving valuable dollars on the table.
Proper representation changes that outcome. With experienced professionals guiding the process, your legitimate credits can be confidently defended using detailed project documentation, legal and technical justifications, and IRS-compliant substantiation. The right experts know how to organize and present the evidence that demonstrates your eligibility and strengthens your position.
CONSIDERATIONS
Why It Matters.
When the IRS challenges an R&D tax credit claim, when initially claimed or at random future audits, it can feel intimidating and worst case scenarios are quickly imagined. Receiving a notice or examination letter doesn’t automatically mean your claim is invalid; it simply means the IRS is asking for proof. Too often, businesses panic, surrender their credits prematurely, or procrastinate, and fail to respond effectively leaving valuable dollars on the table.
Proper representation changes that outcome. With experienced professionals guiding the process, your legitimate credits can be confidently defended using detailed project documentation, legal and technical justifications, and IRS-compliant substantiation. The right experts know how to organize and present the evidence that demonstrates your eligibility and strengthens your position.
THE PROCESS
Holding the Line on Your Credits.
When the IRS issues a notice following your R&D tax credit claim, the process begins with a formal response to the IRS examiner’s requests. Typically, this means submitting supporting documentation such as project descriptions, payroll data, and expense records to verify the validity of your credit claim under IRC Section 41 and IRS guidelines. This first step is critical, as your response establishes the foundation for how the IRS views your claim.
After review, the IRS may move into a formal examination or audit phase, requesting additional details through Information Document Requests (IDRs). Examiners typically focus on qualified research activities, supporting documentation, and credit computations. Depending on the complexity of your claim and the IRS workload, this process can last anywhere from a few months to over a year.
Throughout the audit process, maintaining accurate, well-organized documentation, records of all communication, and professional representation is essential. The IRS may ultimately accept the credit claim without disallowance, adjust it, or disallow it entirely, depending on the strength of the evidence presented. With proper preparation and expert defense, businesses can confidently navigate the process and protect their legitimate credit claims from unnecessary reduction or disallowance.
A timely, thorough response can make the difference between keeping or losing your credit.
REPUTABLE EXPERTS
Prosper With Professionals.
When it comes to R&D Tax Credit examinations, reputation, track record, and experience aren’t optional, they’re essential. Finding proper counsel can be challenging, as not every firm possesses the depth of Section 41 expertise required to defend a credit claim through final resolution. That’s why BDC partners exclusively with a nationally recognized R&D tax credit consultancy whose in-house tax attorneys and technical specialists bring the credentials, credibility, and experience necessary to represent clients effectively before the IRS.
Only knowledgeable experience tax attorneys are referred to BDC clients. In line with our standards of excellence, every engagement is handled with confidentiality, discretion, and timely precision. When your R&D tax credit claim comes under examination, don’t rely on generalists or the same preparers responsible for a deficient filing or a party not licensed to practice before the IRS or the Tax Court. Defending a credit requires targeted experience, legal rigor, and a working knowledge of Section 41, including “on point” tax court precedent rulings. Examination and Audits are not the venue for basic tax preparation professionals. With the right professionals in your corner, you can protect what you are legitimately entitled to, and move forward with confidence.
Attorney-Led Defense with Tax Law Expertise
Focused Remediation, Not Generic Responses
Transparent, Tiered Pricing Structure
Thorough
Section 41 Knowledge
R&D
Audit
Representation
Better
Be
BDC.
BDC is proud to include R&D Audit Representation among our core service offerings. If your business is currently under examination or has received IRS notices related to R&D Tax Credits, now is the time to act decisively and engage qualified experts who can protect your position and defend your credits claims.
Through our collaborative network, BDC engages with an industry-leading R&D tax credit provider staffed with in-house tax attorneys who specialize exclusively in defending Section 41 claims. BDC works with you to understand the circumstances that led to the examination, review all relevant documentation, and identify the underlying causes. From there, we coordinate directly with our trusted audit representation provider ensuring your credit claims are backed by professionals who know how to defend them from start to finish.