R&D Binder

The payroll-tax offset

The credit is not just for profitable companies.

Under Section 41(h), a qualified small business can elect to apply up to $500,000 of its research credit against the employer share of payroll taxes each year, rather than waiting for income-tax liability that may be years away.

A qualified small business generally has less than five years of gross receipts and stays under a current-year receipts threshold. Many venture-backed startups fit squarely inside it.

The work startups already do

Early-stage engineering is often the most experimental.

Building a first product means resolving technical uncertainty constantly: which architecture, which approach, whether a thing can even be built at the scale you need. That is the qualifying profile, and startups tend to have more of it per dollar than mature companies.

The catch is records. Startups move fast and document little, so the audit trail is thin exactly where the credit is richest. Commit history is the exception, because it is captured automatically.

Turning commits into a claim

The data already exists; it just needs assembling.

R&D Binder reads the GitHub history a startup already has and turns it into a scored, source-grounded binder, without adding process overhead the team does not have time for.

The result is the workpaper a CPA needs to claim the credit and, for qualified small businesses, to make the payroll-tax election.

What makes a startup's payroll-offset claim work:

Sources

Every claim on this page traces to a primary authority. Each source below is independent and verifiable.

Get documentation built to survive an exam

R&D Binder documents the credit so your CPA can make the payroll-offset election cleanly. The binder is the evidence; the election is theirs.

Estimate your credit See the sample binder