IRS Issues Guidance on New Tax Credits and Cash Grants for Small Biotech Companies
The PPACA established a tax subsidy for eligible small biotech companies known as the "qualifying therapeutic discovery project" credit. The tax subsidy consists of $1 billion of tax credits or, at the taxpayer's election, cash grants for "qualified investments" made by small biotech companies for the development of new therapies to prevent, diagnose and treat acute and chronic diseases. On May 21, 2010, the Internal Revenue Service (IRS) issued a notice establishing the program and announcing the procedures for applying for credits or cash grants. A Reed Smith tax alert regarding the IRS guidance is available here.
