If your business develops new products, processes, or software, you may qualify for federal and state R&D tax credits worth 6-8% of qualifying expenditures. Our engineers identify and document every eligible activity, turning your innovation into immediate tax savings.
To qualify for the R&D tax credit, activities must meet all four parts of the IRS test. Our engineers are trained to identify qualifying activities that many businesses overlook, even routine product improvements and process optimizations can qualify.
The activity must relate to developing or improving a product, process, software, technique, formula, or invention.
There must be uncertainty about the capability, method, or design at the outset of the activity.
The taxpayer must evaluate alternatives through modeling, simulation, systematic trial and error, or other methods.
The activity must rely on principles of engineering, physics, biology, chemistry, or computer science.
Annual R&D Credit Calculation
Dollar-for-dollar reduction in tax liability. Federal credits can be carried forward up to 20 years. State carryforward rules vary.
Illustrative estimate. The R&D credit is incremental and based on spending above a base amount; actual credits vary by company and state.
The R&D tax credit isn't just for tech companies. Any business that develops or improves products, processes, or software may qualify.
New product development, process improvements, tooling design, quality testing
New features, architecture redesign, cloud migration, AI/ML development
New building methods, material testing, structural innovations, green building
New formulations, shelf-life testing, packaging innovation, process automation
Drug development, clinical trials, medical devices, regulatory compliance
Component design, testing protocols, systems integration, materials research
We review your business activities to identify all potentially qualifying R&D projects and expenditures: often finding credits in unexpected places.
Our engineers conduct detailed interviews with your technical staff to document the technological uncertainties, experimentation, and outcomes of each project.
We analyze your financial records to quantify qualifying wages, supplies, and contract research expenditures for each identified R&D project.
We prepare a comprehensive, audit-ready documentation package including technical narratives, project descriptions, and credit calculations.
We work with your CPA to integrate the R&D credit into your tax return, including Form 6765 and any applicable state credit forms.
We provide audit defense and annual credit studies to ensure you capture R&D credits every year as your business continues to innovate.
Absolutely. The R&D credit applies to any business that develops or improves products, processes, formulas, or software. Manufacturing companies, construction firms, food producers, and many other industries routinely qualify. If your team solves technical problems, you likely have qualifying activities.
You can amend returns for the prior 3 open tax years to claim previously unclaimed R&D credits. Going forward, we recommend annual R&D credit studies to capture credits each year as they occur.
Qualifying expenditures include wages for employees performing R&D activities, supplies consumed in R&D, and 65% of payments to third-party contractors for R&D work. Our engineers help identify all qualifying expenditures across your organization.
Fees are typically based on the complexity of your R&D activities and the size of the expected credit. Most engagements deliver ROI of 5:1 or better. We provide a detailed fee estimate during your free qualification assessment.
Yes, startups with less than $5M in gross receipts can apply up to $500,000 of R&D credits annually against payroll taxes (FICA), even if they have no income tax liability. This is a powerful cash flow tool for early-stage companies.
Find out if your business qualifies for R&D tax credits. Free assessment, no obligation.
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