The research and development (R&D) tax credit enacted in 1981 is a benefit that most businesses tend to overlook.

Recent regulations make it easier for a wide range of companies to qualify for the credit. R&D tax credits do not require an onsite lab nor do you need to be a hi-tech company to qualify. Companies may qualify for the R&D tax credit if they develop, evaluate, test, or improve any of the following:


  • Formulas
  • Inventions
  • Processes
  • Products
  • Software
  • Techniques



Benefits of the R&D tax credit include, among others:


  • Dollar for dollar reduction in your tax liability
  • Increased cash flow
  • Increased earnings per share
If you are in one of the following industries, you may be entitled to the R&D tax credit:

• Government Contracting
• Construction
• Engineering Services
• Architectural Firms
• Financial Services
• Wineries and Breweries
• Biotechnology
• Electronics
• Food Sciences
• Manufacturing
• Medical Devices
• Pharmaceuticals and Nutritional Supplements
• Software Development


A company may qualify if it has invested time, money, and resources toward the advancement and improvement of products and processes. At the federal level, R&D tax credit rules allow eligible taxpayers to “look back” to all open tax years (typically three years plus the current year) for potential R&D tax credits that were never claimed.

R&D Tax Credits Insights

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