< Back to Thought Leadership

2016 Tax Savings Opportunities to Explore for Manufacturers

According to Blue & Co. and LEA’s 2017 National Manufacturing Outlook and Insights survey, 44% of small manufacturers (those with fewer than 100 employees) and 19% of large manufacturers expect revenue growth of more than 10% in 2017. Another 50% of small manufacturers and 30% of large manufacturers expect revenue growth in the 3% – 9% range.

This is a very good sign for the industry.

One of the challenges in fueling this growth is developing additional cash flow strategies to support investment in R&D, Capital Expenditures, Increasing Labor Costs, and Acquisitions – which were all identified as top priorities in the survey.

That is why it is important to revisit tax saving opportunities with the changes to the R&D tax credit that were incorporated into the 2015 PATH Act. Beginning in 2016, qualifying taxpayers (S-Corporations, partnerships, sole proprietors, etc. with average annual gross receipts of $50 million over the previous three years) can now claim the credit against their alternative minimum tax (AMT). Previously, the AMT had greatly limited the benefit of the credit for many of these taxpayers. Additionally, the R&D tax credit can be used to offset payroll taxes up to $250,000 for certain qualifying startup entities.

It’s not too late to claim the credit against your 2016 income tax liability and generate cash savings that can be reinvested for future growth. To discuss how this credit can help fuel your growth, contact Mike Wade at mwade@blueandco.com or 502-992-2597.

Read More Thought Leadership Articles Like what you read? Subscribe to our newsletter. Click Here.

Share this article

Recent Articles View All Thought Leadership

Inventory management strategies for manufacturers

Balancing Cash Flow and Customer Demand: Key Inventory Management Strategies for Manufacturers

By Tyler Irvine, CPA, Senior Accountant at Blue & Co. Effective inventory management is the backbone of any successful manufacturing or distribution business. It is about much more than just […]

Learn More
Not-for-profit financial statements

Beyond the Balances: What Your Not-for-Profit Financial Statements Are Really Telling You

By Luke Pierce, CPA, Senior Manager at Blue & Co. Leaders in the not-for-profit sector are often required to oversee and understand all parts of their organization. For the many […]

Learn More
Bonus depreciation for thoroughbred owners

100% Bonus Depreciation: Finding the Right Tax Strategy for Your Thoroughbred Operation

By Heather Sunseri, CPA, Senior Manager at Blue & Co. For thoroughbred owners and breeders, tax strategy can be just as important as bloodlines and training decisions. And when President […]

Learn More
Share this article
Share this article