What Qualifies for the R&D Tax Credit?

Many businesses are still unaware that R&D credit eligibility extends beyond product development to include activities related to production processes, quality improvement, and software design.

If your company does any of the following, your business likely qualifies for the research and development credit:

  • Develops or designs new products or processes
  • Enhances existing products or processes
  • Improves upon existing prototypes and software

Talk With Our R&D Tax Credit Experts

Schedule a free consultation

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What Qualifies for the R&D Tax Credit?

Many businesses are still unaware that R&D credit eligibility extends beyond product development to include activities related to production processes, quality improvement, and software design.

If your company does any of the following, your business likely qualifies for the research and development credit:

  • Develops or designs new products or processes
  • Enhances existing products or processes
  • Improves upon existing prototypes and software

Each year the U.S. government gives billions of dollars in R&D tax credits, yet many companies are leaving this money on the table. We make it easy to get the cash you deserve.

We'll help determine your eligibility, document your processes, and maximize your return!

Talk With Our R&D Tax Credit Experts

Schedule a free consultation

Drive your Business with

R&D Tax Credit -
Your Incentive for Innovation

Each year the U.S. government gives billions of dollars in R&D tax credits, yet many companies are leaving this money on the table. We make it easy to get the cash you deserve.

We'll help determine your eligibility, document your processes, and maximize your return!

Talk With Our R&D Tax Credit Experts

Schedule a free consultation

What is the

R&D Tax Credit?

The Research and Development (R&D) tax credit is a government incentive designed to reward U.S. companies for investing in innovation. They are a valuable source of cash for businesses to invest in accelerating their R&D, hiring new staff and ultimately growing.

The R&D tax credit is for businesses of all sizes. Companies from various industries can qualify for this government-sponsored tax benefit just by performing their day-to-day activities.

How does the

R&D Tax Credit Work?

Companies that spend money developing new products, processes, or services, or enhancing existing ones, are eligible for R&D tax relief. If you’re spending money on your innovation, you can make an R&D tax credit claim to receive either a cash payment or a corporate tax reduction. The scope for identifying R&D is huge – in fact, it exists in every single sector. And if you’re making a claim for the first time, you can typically claim R&D tax relief for your last two completed accounting periods.

What Qualifies

as R&D?

Many businesses are still unaware that R&D credit eligibility extends beyond product development to include activities and even operations such as the latest manufacturing methods, software development, and quality improvements. Even start-ups may be able to utilize the R&D tax credit against their payroll tax for up to 5 years. The Section 41 four-part test defines activities that qualify for the R&D tax credit:

Permitted Purpose

The activity must contribute to developing or improving the functionality, quality, reliability or performance of a business component.

Technological in Nature

The activities must rely on physical or biological science, engineering, or computer science.

Elimination of Uncertainty

The organization must have faced technological uncertainty when designing or developing the business component.

Process of Experimentation

The company must have evaluated various design alternatives or used a systematic trial & error approach to overcome technological uncertainties.

Costs that Qualify for R&D Tax Credits - Wages & Salaries Raw Materials & Supplies Subcontractors Computer Costs

Who qualifies for

R&D tax credits?

R&D can take place in any industry. It occurs in everything from cheese-making to chemical engineering, manufacturing and construction to renewables.

Agriculture

Architecture

Engineering

Manufacturing

Technology

Food & Beverage

And many more! Contact us to find out if you qualify

The Value

The R&D tax credit is primarily a wage-based credit, which can be worth six to seven figures. For instance, a manufacturer with an annual revenue of $13.5 million was able to receive $310,500 in credits. Many states also offer their own R&D credits, which that can greatly enhance the value of the study. Further, the credit can often be claimed for prior tax years.

Eligible States

Does your state have an R&D Tax Credit?

In addition to the federal R&D tax credit, many states provide their own R&D tax incentives. If you are exploring your eligibility for credits at the federal level, it’s worth exploring whether your state offers incentives too, as you could be rewarded for things your business is already doing or are planning to do.

  • Alaska
  • Alabama
  • Arkansas
  • Arizona
  • California
  • Colorado
  • Connecticut
  • Delaware
  • Florid
  • Georgia
  • Hawaii
  • Iowa
  • Idaho
  • Illinois
  • Indiana
  • Kansas
  • Kentucky
  • Louisiana
  • Massachusetts
  • Maryland
  • Maine
  • Michigan
  • Minnesota
  • Mississippi
  • North Dakota
  • Nebraska
  • New Hampshire
  • New Jersey
  • New Mexico
  • New York
  • Ohio
  • Pennsylvania
  • Rhode Island
  • South Carolina
  • Texas
  • Utah
  • Virginia
  • Vermont
  • Wisconsin

Why alliantgroup?

alliantgroup has continued to be the industry leader in tax credits and incentives for the small- and medium-sized businesses that form the backbone of the American economy. Take a look at some of the key aspects that set us apart from our competition.

Strategic Advisory Board:

alliantgroup has an active Strategic Advisory Board, whose members are recognized experts in their fields and top business minds

Team of Industry Specialists:

Our teams consist of industry specialists such as architects, engineers, software developers, PhDs, scientists, tax attorneys, litigators, ex-Big Four partners, and CPAs to understand the nuances of our clients' businesses

Tech Advantage:

We leverage everything from cloud computing to artificial intelligence to reduce our clients' time commitment, ensure the safety and privacy of their data, and optimize the financial return from our Study

alliantgroup-lp-office-2

FOUND

more than

$16 BILLION

IN GOVERNMENT INCENTIVES

Partnerships

with more than

4000

CPA Firms

COMPLETED MORE

than

60,000

Studies

CREATED More

than

266,000

Jobs

SERVED More

than

27,000

Businesses

Whitepaper

The R&D Tax Credit:
Driving American
Innovation and Job Creation

In this whitepaper, you will learn:

  • Which industries & companies are benefiting the most from the R&D tax credit
  • Why changes relating to laws, regulations, guidance and court decisions have greatly expanded the number of companies that are eligible for the credit
  • Why business owners and CPAs tend to overlook the R&D credit in regard to their tax planning

Testimonials

Words From Our Clients

Want to see how much you could get back in R&D tax credits?

Schedule a free consultation with our team of experts to learn more.
We’ll discuss your eligibility and help estimate your potential tax benefit.