R&D Tax Services

R&D Tax Services

What if you could save hundreds of thousands of dollars annually in state and federal taxes—all thanks to work you’re already doing? Through research and development tax incentives, you can.

R&D Tax Credits

Many companies are unaware that their day-to-day operations could qualify for a dollar-for-dollar reduction of their income tax liability. Indeed, the R&D tax credit regularly provides a wide range of businesses with a source of extra cash—up to 10 percent of annual R&D costs for federal purposes and much more when state credits are factored in.

If your company attempts to create products that are lighter, faster, and less expensive or more durable, reliable, or precise, the R&D tax credit adds up to money you can reinvest in your business rather than pay out to the IRS or state governments. R&D credit eligibility is also much broader than many companies realize, applying to not only the development of products, but also activities and operations, such as new manufacturing processes, environmental improvements, software development, and quality enhancements.

Learn more about R&D tax credits.

Companies in many different industries can qualify for the R&D tax credit for activities they perform. These include:

  • Developing new or improved manufacturing processes
  • Generating prototypes for testing and validation
  • Developing new machines, fixtures, jigs, and tools for aircraft manufacturing and assembly
  • Developing new composite materials
  • Designing new components for customers
  • Developing new or improved metal forming, welding, and machining techniques
  • Implementing automated processes
  • Developing engineering designs or kits for integration of new monuments, galleys, seats, IFE systems, etc., into an aircraft
  • Designing and developing new or improved aircraft monuments and components
  • Developing new or improved manufacturing processes (such as CNC machine programs and manufacturing plans) to build aircraft components with stringent specifications or tight tolerances
  • Developing new surface-hardening methods
  • Developing new heat-treatment profiles and procedures
  • Experimenting to increase product yield and decrease cycle times
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Intranet and Internet software in which scale and complexity present technological
  • Designing new processes in both orchard and warehouse operations
  • Designing specialized tooling and equipment for harvesting and manufacturing
  • Hybridizing during the development of new strains of crops, plants, or livestock
  • Improving harvesting techniques to increase yield or production efficiency
  • Developing or implementing automated processes
  • Developing or implementing new ways to protect crops from disease or insect pests
  • Developing and implementing new irrigation systems
  • Evaluating and developing soil and rootstock improvement processes
  • Developing new or improved packaging processes
  • Developing new or improved preservative chemicals
  • Testing new or improved products for consistency and shelf life
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Designing apparel and accessory products with new or improved function or performance characteristics
  • Developing new clothing innovations that could be eligible for utility patents
  • Designing and developing product and performance specifications for new fabric and material construction technologies
  • Incorporating new clothing technologies and materials into new or improved product designs
  • Developing new material construction methods and techniques
  • Developing new manufacturing processes
  • Manufacturing, evaluating, and testing samples and prototypes
  • Developing new software that will allow customers to view inventories, make purchases, and track merchandise online using Web or mobile applications
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Designing new or improved manufacturing processes to increase production efficiency or component quality
  • Incorporating new technologies into the design and manufacturing process, such as 3-D printing or computational fluid dynamics
  • Developing aftermarket performance products
  • Researching improved materials for component parts, such as polymers, alloys, and composites
  • Examining component defects or failures to improve product quality
  • Testing new or existing components to evaluate performance
  • Developing newer, more efficient emission systems or components
  • Developing alternative fuel systems and components
  • Designing and developing vehicle performance improvements, such as for fuel efficiency and handling
  • Making improvements to automotive components, for example, to increase durability or safety
  • Exploration of new technologies and methods for developing new products
  • Pursuit of advances in products, materials, and processes to increase efficiencies in energy generation or transmission
  • Production of renewable fuels from separated food waste by-products
  • Design and development of hydroelectric facilities and systems
  • Design and development of utility-scale wind generation technologies
  • Design and development of wood-fueled biomass systems
  • Development of alternative fuels and biofuels
  • Developing new types of feedstocks for use in renewable fuel production
  • Development of waste treatment and remediation processes or technologies
  • Engineering of new environmentally friendly petroleum product alternatives
  • Design and development of solar power systems
  • Development of methods or systems for converting sugar cane to ethanol
  • Development of processes for converting landfill gas to methane
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Intranet and Internet software in which scale and complexity present technological
  • Design and development of new or expanded network architecture and technology
  • Development of algorithms in support of dynamic Web applications
  • Development of data analysis tools that require the design of new algorithms and data processing methods
  • Design and construction of physical networks (including copper and fiber-optic network data cabling and wiring)
  • Development of cloud-based communications platforms
  • Development of telecommunication networks to serve customers; for example, integrating voice, message, or voice-over-IP (VoIP) capabilities into a Web or mobile application
  • Design and development of IPTV capabilites for streaming media content
  • Development and testing of new automation methods that provide consistency and efficiency to customers
  • Development of high-speed transceivers for optical networking
  • Development of software and technology to improve transmission capacity
  • Development of network tools to monitor and measure network performance
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Intranet and Internet software in which scale and complexity present technological
  • Development of new plant processes or the expansion and optimization of existing plant operations
  • Development of unique, energy-efficient features
  • Development of unique processes or methods for installing energy-efficient systems
  • Development of innovative wastewater technologies
  • Design of unique water treatment plants to optimize plant capacity or efficiency
  • Development of innovative designs for bridges and roadway structures
  • Design of innovative sanitary sewer systems for new residential communities
  • Design of bridges and highways to meet specific structural and drainage requirements
  • Design of pavement, roadways, and streets and their related infrastructure
  • Design of foundations and earthwork for site conditions
  • Design of renewable energy infrastructure
  • Development of new or improved construction techniques
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Intranet and Internet software in which scale and complexity present technological
  • Developing new product flavors, appearances, textures, or health benefits
  • Developing methods to extend shelf life
  • Designing and developing new products, such as low-carb or trans fat–free products
  • Developing new or improved manufacturing technology, processes, and procedures to increase yield, reduce waste and by-products, improve safety, or reduce labor
  • Developing new packaging and packaging systems or redesigning existing packaging
  • Developing new or improved fermentation processes
  • Producing prototype product samples for testing and validation of new recipe formulations
  • Enhancing designs to comply with new environmental regulations
  • Designing and developing specialized tools or prototype tooling and machines
  • Testing prototype samples for analytical and microbiological qualities
  • Developing new or improved bottling processes
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Intranet and Internet software in which scale and complexity present technological
  • Developing new or improved quality assurance testing processes
  • Developing new or improved waste recycling
  • Developing improved sustainability initiatives to reduce emissions
  • Developing processes to decrease deforestation
  • Development of new or improved automated process
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Intranet and Internet software in which scale and complexity present technological
  • Functional enhancements and new capabilities for existing applications, designed to create a competitive advantage
  • Intranet and Internet software in which scale and complexity present technological challenges
  • Flexible, high-quality, and scalable rule engines to manage and automate complex business structures and models
  • Software to better manage customer relationships through improved collection, storage, and analysis techniques
  • Unit, integration, functional, and performance testing
  • Developing, testing, and refining software source code for firmware
  • Developing new medical products, devices, equipment, or technology as well as next-generation products and product improvements
  • Designing, developing, and testing prototypes for new product validation
  • Testing to satisfy domestic and foreign regulatory requirements
  • Developing new or improved pharmaceuticals, devices, or diagnostics
  • Developing or improving drug formulations to reduce side effects or dosage
  • Improving shelf life or product stability
  • Developing new or improved pharmaceuticals, devices, or diagnostics
  • Developing production processes for new products
  • Manufacturing experimental clinical trial lots of pharmaceuticals
  • Designing and developing a new or improved factory or production line in which innovative techniques or new technologies are employed
  • Developing technology for meeting EPA compliance requirements
  • Designing and developing hardware or software systems for use in research and clinical development
  • Designing and developing medical equipment used for research
  • Improving shelf life or product stability
  • Developing or improving drug formulations to reduce side effects or dosage
  • Developing new medical products, devices, equipment, or technology as well as next-generation products and product improvements
  • Computer-assisted design (CAD) modeling for new product development
  • Designing, developing, and testing prototypes for new product validation
  • Designing and developing new or improved factory or production lines that employ innovative techniques or new technology
  • Developing processes, tools, technology, or equipment to satisfy EPA compliance requirements
  • Testing to satisfy domestic and foreign regulatory requirements
  • Unit, integration, functional, and performance testing
  • Developing, testing, and refining software source code for firmware
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Intranet and Internet software in which scale and complexity present technological
  • Exploring new design concepts and defining specifications
  • Engineering and designing new products and processes
  • Improving the design of existing products
  • Improving manufacturing or production processes
  • Developing manufacturing plans
  • Designing, modeling, simulating, and analyzing new or improved products or processes
  • Developing special tooling and equipment used in the manufacturing process
  • Designing, building, and testing prototypes
  • Testing the adequacy of a new or improved design
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Designing Intranet and Internet software that responds to scale and complexity challenges
  • Designing and developing new or improved technologies
  • Analyzing and implementing new materials and technologies
  • Developing new and innovative designs for structures
  • Designing for and analyzing structural performance
  • Designing and developing new or improved systems, materials, or products
  • Designing and developing new or improved machines, equipment, or tooling
  • Computer-aided design (CAD) and building information modeling (BIM) activities
  • Performing scientific calculations to determine the physical properties of materials in various environments
  • Evaluating alternative subcomponents, methods, and materials for use in designs
  • Designing and developing new and innovative LEED, energy-efficient, or green systems and structures
  • Designing and developing new or improved infrastructure projects, such as bridges, dams, subsurface tunnels, and rail systems
  • Designing and developing new or improved wastewater treatment facilities, pump stations, or other water supply facilities
  • Designing and developing new or improved electrical, lighting, alarm, communication, and control systems
  • Designing and developing new or improved HVAC, building envelope systems, and mechanical systems
  • Analyzing soil and subterranean conditions, drainage design, foundation design, and other related design and development efforts
  • Modeling and simulating new or improved designs for testing and evaluation purposes
  • Conceptualization of design specifications and analysis of technical feasibility
  • Researching appropriate materials to account for weight, strength, durability, texture, and cost
  • Design, modeling, prototyping, fabrication, and installation of exhibits, displays, and mannequins
  • Design and development of retail fixtures, including displays, lighting, and shelves
  • Design and development of cabinets and fixtures with requirements for weight, durability, flexibility, and resistance to scratching or corrosion
  • Development of new attachment methods or techniques
  • Engineering of new assembly and installation methods
  • Improving manufacturing or production processes
  • Designing, modeling, simulating, and analyzing new or improved products or processes
  • Intranet and Internet software in which scale and complexity present technological challenges
  • Development of new software applications to interact with customers or vendors
  • Software to better manage customer relationships through improved collection, storage, and analysis techniques
  • Developing code for new software architecture or algorithms
  • Developing functional enhancements and new capabilities for existing applications, designed to create a competitive advantage
  • Developing intranet and Internet software in which scale and complexity present technological challenges
  • Developing flexible, high-quality, and scalable rule engines to manage and automate complex business structures and models
  • Developing software to better manage customer relationships through improved collection, storage, and analysis techniques
  • Developing specialized technologies, such as artificial intelligence or voice recognition applications
  • Developing interactive software to support the delivery of multimedia entertainment, such as streaming music or video or Internet video games
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Developing new or improved fermentation and distillation processes
  • Designing custom equipment used in manufacturing
  • Developing or implementing automated processes
  • Developing and implementing new irrigation systems
  • Developing new or improved bottling and packaging processes
  • Developing filtration or straining methodologies
  • Designing and developing improved fermentation or bottling equipment
  • Developing new or improved product formulations
  • Developing new or improved preservative chemicals
  • Testing new or improved products for consistency and shelf life
  • Developing new or improved prototype batches
  • Investing in green technology used in manufacturing
  • Development of new software applications to use internally, or to interact with customers and/or vendors
  • Intranet and Internet software in which scale and complexity present technological

Expense Deduction

Costs related to R&D may be eligible to be expensed immediately—even those costs not eligible for the R&D credit. Expenses incurred for software development, equipment used in your business, or other similar expenses are generally capitalized and depreciated over a specified period of time. If eligible as a qualified R&D expense, such costs can be immediately deducted, therefore reducing your overall tax liability in the current year.

Seize the Opportunity

Moss Adams performs more than 150 R&D engagements annually. We can examine all your company’s activities and determine which areas are eligible to take advantage of current R&D tax credit rules and regulations. We then help you identify qualified R&D activities—including those that can be expensed immediately—and assemble documentation to defend your claim based on our extensive knowledge of the law and your industry.

We work in an efficient and nonintrusive manner, so you can stay focused on your business. And we have a great deal of experience helping pass-through entities and partnerships such as LLCs, LLPs, C corporations, and S corporations claim the R&D credit. Whatever your R&D activity may be, we scale our services to fit your business needs and provide a customized solution that aligns with your goals.

Complimentary Benefits Estimate

Discover how you can turn R&D expenses into tax savings by filling out our complimentary benefits estimate request form. A Moss Adams professional will contact you with a preliminary estimate of the potential tax benefit to your organization.

Insights

Article
IRS Campaign Addresses Research Credit and Expenditure Incentive Compliance
The IRS’s new Research Issues campaign is intended to increase R&D credit and expenditure incentive compliance.
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Article
Avoid Delays and Added Costs When Claiming the R&D Payroll Tax Credit
New businesses may be eligible to apply R&D payroll tax credits against their payroll taxes for up to five years. Learn how to avoid common pitfalls.
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Article
5 Tax Credits and Incentives That Could Help Increase Cash Flow
Learn the areas of opportunity that could potentially result in significant savings and a greater cash flow for your business.
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Guide
Your Guide to Claiming the Federal R&D Tax Credit
The federal R&D tax credit is available to a wide range of companies, regardless of industry. Inside this guide, you’ll find helpful discussions on what it takes to qualify for the credit and what steps you need to take to pursue it. We cover required documentation, qualifying expenses, recent legislative changes, methods for claiming the credit, and more.
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Article
Five Common Misconceptions about the R&D Tax Credit—and Whether Your Company Qualifies
Determine if your company qualifies for the R&D tax credit—and which documentation to provide to successfully claim it.
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Article
Businesses Can Still Offset AMT with R&D Credits
Learn how eligible small businesses and individuals can offset alternative minimum tax (AMT) with R&D credits.
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