Tax Strategy
R&D Tax Credits
Transform your innovation investments into valuable tax credits. Maximize returns on research and development activities.
What are R&D Tax Credits?
Research and Development (R&D) tax credits are a powerful federal and state tax incentive designed to reward businesses for investing in innovation and technological advancement. These credits can significantly reduce your tax liability while supporting your company's growth and competitive edge.
Many businesses unknowingly conduct qualifying R&D activities. Whether you're developing new products, improving existing processes, creating software solutions, or conducting experiments to overcome technical challenges, you may be eligible for substantial tax credits that directly offset your federal and state tax obligations.
The R&D tax credit can be applied against regular income tax, and in some cases, startups and small businesses can even use these credits to offset payroll taxes. This makes it an exceptionally valuable tool for companies at all stages of growth.
Key Benefits
Reduce Tax Liability
Lower your federal tax burden by claiming credits for qualified research activities and innovation investments.
Support Innovation
Reinvest tax savings into further research and development, accelerating your competitive advantage.
Maximize R&D ROI
Transform research expenses into valuable tax credits, improving your bottom line and cash flow.
Strategic Tax Planning
Integrate R&D credits into your comprehensive tax strategy for long-term financial optimization.
Qualifying Activities
R&D tax credits apply to a wide range of innovation activities. Here are common qualifying activities across industries:
Product Development
Creating new products or improving existing ones through technical research and experimentation.
Process Improvements
Developing new manufacturing processes or enhancing existing production methods for efficiency.
Software Development
Designing, developing, and testing software applications, algorithms, and technical solutions.
Experimental Research
Conducting experiments to resolve technical uncertainties and advance technological capabilities.
Prototype Testing
Building and testing prototypes to evaluate new designs, materials, or technological approaches.
Engineering Design
Performing technical design work that involves new or improved functionality, performance, or reliability.
Industries We Serve
Our R&D tax credit services support innovation across diverse sectors. We understand the unique challenges and opportunities in each industry.
Technology & Software
Software development, cloud platforms, AI/ML, cybersecurity, and emerging tech solutions.
Manufacturing
Production process improvements, automation, materials science, and quality enhancement.
Engineering & Construction
Structural engineering, systems design, building innovations, and construction technology.
Software & Applications
Mobile apps, web platforms, enterprise software, database systems, and API development.
Biotech & Pharmaceuticals
Drug development, clinical research, medical devices, and biotechnology innovations.
Food & Beverage
Recipe development, processing techniques, packaging innovations, and quality control.
How It Works
Assessment
We review your business activities to identify qualifying R&D expenditures.
Documentation
We compile comprehensive documentation supporting your credit claims.
Calculation
We calculate your maximum eligible tax credits under current regulations.
Filing
We prepare and file the necessary forms to claim your R&D tax credits.
Common Qualifying Expenses
Employee Wages
Salaries and wages for employees directly engaged in qualified research activities, including engineers, scientists, developers, and technicians.
Contractor Costs
65% of amounts paid to third-party contractors performing qualified research on your behalf.
Supply Costs
Materials, supplies, and equipment used directly in the research process, including prototype materials and testing supplies.
Cloud Computing
Cloud-based computing services and software tools used directly in qualified research activities and development processes.
R&D Credit Claim Process
How we identify, document, and claim your R&D tax credits from start to finish.
Discovery & Qualification Assessment
We begin with a comprehensive business review to understand your research activities, product development cycles, and technical challenges. Our team interviews key personnel including engineers, developers, scientists, and project managers to identify all potentially qualifying R&D activities. We assess both current year and prior year opportunities (credits can be amended back 3 years).
Deliverable: Qualification assessment and preliminary credit estimate
Documentation & Expense Analysis
We work with your finance and technical teams to gather payroll records, project documentation, contractor invoices, and supply costs. Our specialists apply the four-part test (technological in nature, elimination of uncertainty, process of experimentation, technological information) to categorize activities. We review employee time allocation, project codes, and direct vs. indirect expenses to maximize qualifying research expenses (QREs).
Deliverable: Detailed activity documentation and expense categorization
Credit Calculation & Report Preparation
We calculate your R&D credit using both the regular credit method (current year vs. base years) and alternative simplified credit method, selecting the optimal approach. Our team prepares comprehensive technical documentation demonstrating how your activities meet IRS requirements under IRC Section 41. The report includes detailed project narratives, cost schedules, and supporting evidence for each claimed activity.
Deliverable: Complete R&D tax credit study and Form 6765 schedules
Tax Return Integration & Filing
We coordinate with your CPA to integrate R&D credits into your tax return via Form 6765. For qualified small businesses, we help offset payroll taxes against the credit if beneficial. If amending prior years, we prepare Form 1120-X or 1040-X with complete supporting documentation. Our team ensures compliance with both federal and applicable state R&D credit programs for maximum benefit.
Deliverable: Tax filing coordination and amendment preparation if applicable
Future Year Planning & IRS Defense
We help establish processes for ongoing R&D credit capture, including employee time tracking systems and project documentation standards. Our audit defense support means we'll work directly with the IRS if your credit is ever questioned, providing expert testimony and technical defense at no additional cost. We remain available for annual credit claims and consultation on new qualifying activities.
Deliverable: Process implementation guidance and lifetime audit support
Ready to Claim Your R&D Tax Credits?
Discover how much your business can save through R&D tax credits. Our experts will analyze your qualifying activities and maximize your tax benefits.
R&D Tax Credits - Frequently Asked Questions
Common questions about qualifying for and claiming R&D tax credits for your business
Still have questions? Let's discuss your specific situation.
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