In a welcome move for businesses and tax practitioners, the IRS announced in IR-2025-99 (Oct. 1, 2025) that it will extend the comment period for the draft instructions to Form 6765, used to claim the Credit for Increasing Research Activities (R&D Tax Credit).
Perhaps most welcome for taxpayers, the IRS confirmed that Section G of Form 6765 will remain optional for all filers for tax year 2025 – a relief for many navigating the evolving compliance landscape.
More Time to Weigh In
After releasing draft instructions in late 2024, the IRS received significant feedback from stakeholders requesting additional time to evaluate the changes. In response, the agency has extended the comment period through March 31, 2026. Tax professionals and taxpayers are encouraged to submit feedback to [email protected] with the subject line “Instructions for Form 6765.” Final instructions are expected in January 2026, ahead of the 2025 filing season.
Section G: Optional for Now, Mandatory Later
Section G, which introduces new reporting requirements, will be optional for all filers in tax year 2025 (processing year 2026). However, starting in tax year 2026 (processing year 2027), Section G will become mandatory, with limited exceptions for:
- Qualified Small Businesses (QSBs) under Section 41(h)(3) claiming a reduced payroll tax credit.
- Taxpayers with qualified research expenditures (QREs) ≤ $1.5 million and gross receipts ≤ $50 million, determined at the control group level, filing an original return.
This phased approach gives businesses time to prepare for the expanded reporting requirements while continuing to claim the credit without immediate changes.
Refund Claim Transition Period Extended
The IRS also extended the transition period for research credit refund claims through January 10, 2027. Taxpayers now have 45 days to perfect a claim before the IRS makes a final determination. For claims postmarked after June 18, 2024, the IRS requires:
- Identification of all business components related to the R&D tax credit.
- Description of research activities for each component.
- Disclosure of total QREs related to wages, supplies, and contract research.
Form 6765 may be used to meet these substantiation requirements.
Final Thoughts
The IRS’s decision to keep Section G optional for 2025 offers a much-needed reprieve for businesses still adjusting to the evolving R&D credit landscape. With more time to provide feedback and prepare for future compliance, taxpayers and advisors should take advantage of this window to engage with the IRS and ensure readiness for 2026 and beyond.
How Can Schneider Downs Help?
Schneider Downs helps businesses identify and claim R&D tax credits across industries like manufacturing, software, logistics, and construction. Whether you need a full study or a review of your current calculation, our team can help you uncover opportunities and maximize your return. For more information contact us at [email protected].
About Schneider Downs Tax Services
Schneider Downs’ tax advisors have experience and expertise in a wide range of industries, including Automotive, Construction, Real Estate, Manufacturing, Energy & Resources, Higher Education, Not-for-profits, Transportation and others. Our industry knowledge and focus ensure the delivery of technical tax strategies that can be implemented as practical business initiatives.
To learn more, visit our dedicated Tax Services page.
