Clarus R&D Solutions - Overview Presentation

R&D Tax Credit

for Start-UpsInformational Brief

Topics

What Changed?

The Impact

Clarus R&D

The Clarus process

Case study

Getting started

The Federal Researchand Development Tax Credit

Originally established in 1981

by the Economic Recovery

Tax Act (ERTA)

1981

Nearly $14B credits claimed

in 2015$14B

87% of credits claimed by

companies >$100M in

revenue

87%

60% ($6.8B) of credits

claimed by manufacturing

industry

60%

The Protecting Americans

from Tax Hikes (“PATH”) Act

was signed into law

December 18, 2015

Dec 18

Has been permanently

extended

R&D credit can offset

payroll tax

Final regulations issued in

early 2015 clarify the

definition of qualified

research for software

development activities

2015

2 Major Changes for Startups

05

The Impact

Companies with little or no revenue can now monetize

the credit if they are a ‘qualified small business’

Generally results in up to 10% of qualified

investment on new innovation, plus state incentives

Permanently enacted, with bi-partisan support

Start-ups, investors,

and funders have

access to a new

form of non-dilutive

capital that never

existed before

Can be claimed every year, for new, or improvements to

existing products/ or processes.

06

Qualified Small Business

<$5 million in revenue in the tax year in which it makes the payroll election; AND

$0 revenue in any tax year preceding the five-tax-year period that ends with the tax year of the election (e.g. For a 2016 payroll election, cannot have had any revenue prior to 1/1/12)

A Qualified Small Business:

Claim up to $250,000 R&D tax credit against their payroll taxes each year

Make a payroll offset election for each year they are a qualified small business

Qualified Businesses can:

…is a technology enabled tax service made specifically for

entrepreneurs.

We provide a seamless and efficient way for start-ups and early stage

companies to qualify for and claim the Federal R&D tax credit.

08

Our Story

Our mission: to help as many entrepreneurs as possible get this

money back into their business and enable innovation and growth.

Brent JohnsonPresident

Clarus Partners

Columbus based accounting firm

Jeff HaskettTechnology

Entrepreneur

Together providing a deep

expertise in tax, accounting,

start-ups, and technology

Began when Brent recognized a

huge opportunity with passing of

the PATH act

Qualification &

calculation reports are

generated and kept for

your records and

compliance

Documented &

Secure

Integration with payroll

providers for easy

filing of the offset –

Clarus takes care of

everything

End to End,

Turn-key Service

Contingent fee with no

cash up front, pay only

when benefit is

received

Cash Flow

Friendly Pricing

SaaS-based, ‘Turbo-

tax’ experience with

lots of help and no

extra work

Self guided but with

credible support from

tax professionals

Technology

Enabled

Built for Start-ups

010

Our Solution

Built for busy people…

Save/resume for when you have time

Real time credit calculation

Self guiding ‘wizard’ based interface with

lots of help and examples

Compliant report generation

Getting Started

Kickoff Meeting

1

Kickoff Qualification Calculation Strategy Filing

Getting Started

Qualification and Preliminary

Credit Calculation

Using Clarus R&D internet based technology

Clarus R&D Tax Analyst review

Qualification Report & Draft Calculation of your credit

21


Getting Started

Final Credit Calculation

After year-end financial close

21 3


Getting Started

Monetization Strategy

(payroll deduction or income tax credit)

21 3 4


Getting Started

Payroll Filing with

Quarterly Tax Filing

With payroll processor, handled by Clarus R&D

21 3 4 5


016

Our Pricing

There is never an upfront fee.

Our fee is a percentage of the credit you realize, and only after you start to receive it.

With three year agreement, and partner discounts, most customers pay only 10%.

With ACH agreement there is is never an invoice.

Cash Flow Friendly for Start-ups: