Any company, group, trust, estate, or person can claim an R&D tax credit. This applies to the last three tax years and will also apply in the future. Our R&D tax credit specialists work with businesses in the US. We help them claim the tax incentives they deserve easily. We go beyond consulting. We become a trusted part of your team. We help find hidden value in your daily innovation.
What Kind of Research and Development Activities are Eligible?
Activities that are technical in nature or that involve design, development, or improvement of new or existing:
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- Processes
- Products
- Techniques
- Formulas
- Inventions
- Software
Development efforts must include activities focused on improved:
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- Performance
- Functionality
- Reliability
- Quality
Qualifying expenditures can include:
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- U.S. wages (including supervising and support staff)
- U.S. contractor costs
- Materials and supplies used for R&D
- Cloud computing development expenses
The Four-Part Test
The IRS created a four-part test in IRC 41 (d). This test can help you see if your company’s research and development work qualifies for the R&D tax credit.
New or Improved Business Component
The activity must create a new or better business part. This can be a product, process, formula, invention, software, or technique. The development of the new or improved business component must focus on enhancing its function, reliability, quality, or performance. These efforts and costs for improvement or innovation do not have to be new to the world. They just need to be new and innovative for your business.
Elimination of uncertainty
The goal of the activity is to find information. This information should help reduce uncertainty about the capability, design, or method of the process or product. In simple terms, changes made just for looks, style, taste, or seasonal design do not qualify for the R&D tax credit.
Process of experimentation
A qualifying activity must demonstrate the evaluation of alternatives for achieving the desired result through the elimination of uncertainty. This may include processes like simulation and modeling, trial and error, and iterative designs. In these designs, different approaches and methods are tested during the development process. This can include alternative materials, sizes, orientations, and designs. These changes aim to improve the product or process’s performance, quality, reliability, and functionality.
Application of scientific principles
The activity must rely on fundamental technological principles and be rooted in the hard sciences. Examples include but are not limited to engineering, biology, physics, chemistry, agronomy, civil engineering, environmental remediation, and computer science.
What Types of Businesses Can be Eligible?
Simply select an industry or sector to find out more about what qualifies for R&D tax relief:
- Biotech & Lifesciences
- Construction
- Food & Beverage
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How we can help
R&D Tax Credit
Our R&D tax credit experts work with businesses in the US. We help them claim the tax benefits they deserve easily.
Section 174A
A limited-time opportunity for small businesses to amend past returns and claim potentially large refunds.
Rapid Claims
Ayming's streamlined process for completing R&D tax claims in just five days.
