In 2015, the IRS published proposed regulations that expand the eligibility of the Research Credit for customer-facing software development. Specifically, the new regulations modify the definition of Internal Use Software (“IUS”) to remove software that enables third party interaction with businesses.

In a 2015 Journal of Taxation article, Tax Credits Group President Michael Krajcer provides a detailed overview of the credit limitations that faced IUS development, how the proposed regulations help to clarify the definition of IUS software in comparison to non-IUS or software for sale, and why financial institutions investing in technologies such as online banking, online investment services, web-based insurance quoting services, and mobile apps stand to benefit most from the new regulations.

To download the full article, please visit

About the Author: Bethany Jones-Worner

Bethany Jones-Worner is Managing Director of TCG. With a decade of experience in Research and Development Tax Credit consulting, she’s helped her clients in the banking, software and manufacturing industries save millions.