Had a question asked of me that I do not have the answer. The guy is a "sub" for drilling the underground holes/tunnels for the wiring to get to the windmills. Is he manufacturing and selling a product that would qualify for the product? I think I was the fourth person asked and I did not have enough knowledge to answer - I am still confused in the architects qualifying.
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First off, it's a deduction, not a credit. If this is a SP without employees, then no deduction. The instructions for 8903 are actually pretty good, as is this article. http://www.journalofaccountancy.com/.../20102727.html -
Yes a deduciotn
He has a team(s) that puts this in he grosses millions and netted millions and has a lot of salaries. I am not sure there is any ownership, but there seems to be some that work. There are huge contracts - he is locked up for a few years it sounds like. All midwestern States.Comment
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He gets the deduction
He gets the deduction, but only if he has a job-cost ledger and the appropriate costs (including W-2 labor) are collected for this production.
There is no danger of the prime contractor duplicating the deduction because the prime paid the subcontractor and did not pay W-2 labor that the sub provided. If the prime also had W-2 labor in addition to paying the sub, the prime may be entitled to his share of the costs.
Strange about DPAD, it is a deduction for taxes only, and is not supported by a charge to the general ledger.Comment
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