Entities that incur qualified clinical testing expenses in the development of orphan drugs can claim the orphan drug credit. This includes pharmaceutical companies, biotechnology firms, and other research organizations.
To figure the amount of your orphan drug credit, complete Form 8820 according to the instructions provided. You’ll need to enter information about your qualified clinical testing expenses and apply the applicable reduced credit percentage. The resulting figure is the amount of credit you can claim.
Form 8820 should be filed with your federal tax forms by the due date, including any extensions. If you’re unsure about the deadline, consult the IRS website or contact the Internal Revenue Service for guidance.
Yes, you can amend a previously submitted Form 8820 by completing a new form with the corrected information. Be sure to include a statement explaining the reason for the amendment and attach any required supporting documentation. Then, submit the amended form to the appropriate IRS address.