Calculating the R&D Tax Credit
The Section 41 credit for increasing R&D activities uses a complicated calculation to determine how your wage, contractor, and material costs translate into a dollar-for-dollar reduction in tax liability. While the calculator is a good starting point, the final number should be calculated by an experienced professional due to its many moving pieces and various available calculation methodologies.
Recent Industries We've Served
Traditional “R&D” industries such as engineering and software development are only the tip of the iceberg for the types of companies who can claim the R&D Tax Credit. Other industries that can qualify for the credit include:
Activities Qualified for the R&D Tax Credit
Many businesses’ day-to-day activities can qualify for the R&D Tax Credit.
These can include, but are not limited to, the following:
- Developing concepts for new or improved designs
- Meeting on functional design requirements
- Building, testing, and refining prototypes
- Producing test batches of new or improved formulations
- Meeting to discuss design challenges and progress
- Assessing and testing new or different materials used in products
- Refining product designs for manufacturability
- Designing processes or techniques
- Computer-aided design modeling and development
- Writing and refining software code
- Final pre-production quality assurance testing
- Developing new or improved production or testing processes
- Conducting pilot production runs