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Scenario $1$: R&D Tax Credit $($Research & Development$)$

A technology company incurs the following qualified research expenses:

Wages: $$400,000$

Supplies: $$80,000$

Contract Research: $$150,000$

Current year gross receipts: $$2,000,000$

Base period gross receipts $($prior $3$ years$)$ average: $$500,000$

Interest & Dividend Income: $$1,000$

Itemized Deductions: $$12,000$

Allowable deduction for self$-$employment tax: None $($all employees, no self$-$employment income$)$

Calculate:

The potential R&D tax credit $($consider regular and simplified methods$)$

Impact on AGI, Taxable Income, and Total Tax Liability