AI is reshaping the workforce. Learn how the AI Workforce Training Act could offset AI training costs and help companies stay competitive.
With the July 6, 2026, deadline quickly approaching, CPA firms must make strategic decisions regarding §174A, which allows certain small businesses to retroactively deduct (instead of amortize over several years) domestic research and development (R&D) costs on their taxes for tax years 2022–2024. After years of amortization requirements that spread expenses over several years, the change creates both an opportunity and new complexities.
Join us for a technical, post–tax season webinar focused on the legislative developments and planning implications emerging from the One Big Beautiful Bill Act (OBBBA) and related IRS guidance.
The July 6 Section 174 deadline is creating major planning decisions for CPA firms. Dave McGuire and David Seibel break down Section 174A elections, R&D credits, Form 6765 updates, and what CPAs need to do now.
McGuire Sponsel advised an engineering firm on how to qualify for R&D Credits, as well as being compliant with 174 and 174A.
McGuire Sponsel secured millions across additional deductions and tax refunds for a manufacturing company using the small business election
A Kentucky-based software company secured a combined $200,000 in federal R&D Credits and addressed missed opportunities in prior tax years.
The Tax Court’s decision in George v. Commissioner offers an important reminder for CPAs working with agricultural clients claiming R&D credits. This article explains what the ruling signals for qualification, supply costs, and why documentation often determines whether credits survive scrutiny.
California has introduced the Alternative Simplified Credit (ASC) for the R&D Tax Credit starting in tax year 2025, replacing the Alternative Incremental Credit (AIC). For CPAs, this change creates new opportunities and planning considerations, particularly for clients with fluctuating gross receipts and multistate R&D activity.
For early-stage AI startups, the R&D Payroll Tax Credit can provide something rare — immediate cash-flow relief. This blog breaks down how the credit works, who qualifies, and why timing matters for companies looking to reinvest in growth.
AI Workforce Training Act: What It Signals for Employers and Tax Strategy
Congress just sent a signal about the future of work, and smart companies should take note. A new bipartisan bill, the AI Workforce Training Act, introduces an AI training tax credit that would allow businesses to claim a 30% tax credit on AI training expenses, including course fees, employee time, and the cost of building internal programs. The credit caps at $2,500 per employee per year, indexed to inflation.
That’s a meaningful incentive. But the more important point isn’t whether the bill passes. It’s what the bill tells us about the future of work.
AI has already proven to be a powerful tool for accelerating results, but only if used by those who know not just AI’s capabilities but also its limitations. There are numerous stories of AI generating false data and conclusions, resulting in disastrous outcomes for companies that relied too heavily on it. Companies that use AI well will outpace those that don’t. The difference will come down to how companies train their employees to effectively leverage this technology.
While the AI Training Credit is not yet law, other tax incentives are available that can reduce the cost of training employees to effectively use AI tools. State and local governments often provide training credits or grants to help companies train and upskill their workforce, such as the JobsOhio Workforce Grant, Pennsylvania’s Wednet program, and the Texas Skills Development Fund.
For innovative companies, the R&D Credit remains a valuable incentive. Businesses developing AI technologies (see previous blogs) may qualify for both federal and state R&D Credits, which can help reduce development costs.
Now is the time for companies to act. While the proposed AI Training Credit moves through the legislative process, companies do not need to wait on the sidelines. Companies need to identify incentives, invest in employee education, and start building internal AI training programs today. The companies that act early will be better positioned to adapt, compete, and grow as AI continues to reshape the workforce.
David Seibel is a Shareholder in McGuire Sponsel’s R&D Tax Credit practice. He combines his knowledge of tax law with his engineering expertise to maximize companies’ research credits and reduce their overall tax burdens.
David ensures clients are receiving studies that meet the highest level of quality. He conducts fieldwork, produces detailed technical calculations, and builds narratives that accurately reflect each company’s research and experimentation activity.
Recent Resources
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blogR&D Tax Credit ServicesFebruary 19, 2026California Adopts Alternative Simplified Credit for R&D
by David Seibel, EACalifornia has introduced the Alternative Simplified Credit (ASC) for the R&D Tax Credit starting in tax year 2025, replacing the...
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blogR&D Tax Credit ServicesFebruary 16, 2026
R&D Payroll Tax Credit Can Provide Immediate Benefit to AI Start-ups
by David Seibel, EAFor early-stage AI startups, the R&D Payroll Tax Credit can provide something rare — immediate cash-flow relief. This blog breaks...
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blogR&D Tax Credit ServicesJanuary 29, 2026
Separating Qualifying and Non-Qualifying ERP Implementation Activities for R&D Tax Credits
by David Seibel, EAUnderstand when ERP implementation and integration activities may qualify for the R&D Tax Credit and how to apply IRC Section...
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webinarsR&D Tax Credit ServicesJanuary 22, 2026R&D Tax Credits in 2026: Innovation Meets Opportunity
by Tanner Niehaus, CPA, & David Seibel, EAThe OBBBA introduced changes to research expensing as well as the R&D Tax Credit, and industry and legislative pressures continue...