Under the PATH Act of 2015 a "Small Business" is:
- A corporation the stock of which is NOT publicly traded
- A partnership, or
- A sole proprietorship, AND if the average annual gross receipts of such corporation, partnership or sole proprietorship for the 3-taxable-year period preceding the taxable year does not exceed $50M
If the company wants to claim the credit in 2016, they would need to look at 2015, 2014, and 2013 gross receipts, total and divide them by 3 and be under $50M.