Know What You're Using: Facts About Tax Credit Calculators

3 Minute Read
Posted by Randy Eickhoff on Jul 20, 2015 8:15:14 AM


Tax credit calculators are the latest and greatest tool for business tax filers. After imputing just a few simple figures, these online tools do the complicated tax math for you, providing a quick estimate of what you will receive or what you will owe the I.R.S. After using several (or perhaps a more robust, all-inclusive calculator) you can essentially estimate what you will be receiving in tax benefits or penalties for the year. Almost every tax-related software company or tax business out there is working to create these online tools to help their current and potential customers who are seeking results for complicated tax calculations.

Some of the online tax-related calculators available for businesses are:

  • Small Business Tax Calculator: This tax benefit is offered to those who are providing health care coverage to their employees. The tax calculation is calculated based on how many full-time employees the company has, how much is paid in wages each year and how much of the health insurance premiums the employer pays.
  • R&D Tax Calculator: This calculator helps to estimate the potential R&D tax credit a business could receive for any research and development work the company is conducting. The calculator uses figures from wage expenses and research and supply costs. 
  • Self-Employment Tax Calculator: For someone who is self-employed, operating a farm or the employee of a church, self-employment taxes may be due. These tools will estimate what that payment may be.
  • IC-DISC Calculator: If a business qualifies to become IC-DISC (Interest Charge Domestic International Sales Corporation), there are a number of tax advantages because it reduces the exporting tax liabilities. As a tax-exempt entity, these organizations don't pay federal tax on commission income. Online IC-DISC calculators use the total of international sales, net income, and marginal tax rate to estimate commission.

Important Fact About Tax Calculators

Every tax tool out there like these will have a disclaimer about estimates at the bottom that look something like this:

“Information and estimates provided are based on the information provided, and are not intended to replace actual calculations completed with appropriate documentation by a tax consultant. These estimates should not be relied upon and are not intended to be advice.”

The key word with these tools is, ‘estimates.’ Accurate calculations require detailed information regarding the adjusted gross income, any taxable income, available deductions, and how you can maximize all available credits. Every business tax situation is different, especially for a new business owner, so it’s not enough to simply use basic online tools if you want to truly understand your tax situation.

At Acena Consulting, we offer online calculators to help you facilitate the early process of understanding the IC-DISC commission and R&D credit calculations for businesses. After you obtain these estimates, we want to be the tax consulting firm you seek to find out how you can maximize these potential benefits. Try out our complimentary online tools and resources then contact us to see how we can fine-tune the numbers for an accurate result for your specific business.

New Call-to-action

Randy Eickhoff

Randy Eickhoff

Acena Consulting President Randy Eickhoff, licensed CPA, has partnered with more than 200 companies during more than 20 years of experience securing tax credits and other government incentives. His corporate partners range from multinational technology firms to smaller, privately held manufacturing, sports, and technology enterprises.