Return on Software: Maximizing the Return on Your Software Investment

Tax Credits

At the time this book was published, there were no tax credits available for software-related activities (or for most business activities, for that matter). However, tax credits have been available to business and individuals in the past, and they may become available again in the future. This section explains how tax credits would be addressed, should they be available.

For all other things such as expenses, loan interest payments, and depreciation held constant, each additional dollar of before-tax income will result in

$1.00 – (Effective income tax rate as cents)

of additional after-tax income. Each additional dollar of before-tax income with an effective income tax rate of 39% will yield

$1.00 – $0.39 = $0.61

of additional after-tax ...