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The R&D Tax Credit: An Overlooked Opportunity for Your Business

Providing eligible businesses $12 billion dollars a year through the federal credit and other related tax breaks, the R&D Tax Credit is one of the most generous and lucrative tax incentives offered by the U.S. government.

It is also one of the most overlooked, with only one out of every 20 eligible small and mid-sized businesses applying for the credit.

Worst yet, when it comes to ignoring R&D, manufacturers are some of the worst offenders – a real shame considering the broad number of activities that qualify.  If your manufacturing company is in the business of improving their products or internal processes, chances are your company could substantially benefit from this incentive.

Among a host of other eligible activities, manufacturers who’ve performed the following have seen significant returns on their R&D investment:

• Innovative product development through computer aided design tools
• The creation of second generation or improved products
• Developing or improving upon tooling and equipment fixtures
• Designing manufacturing equipment
• Prototyping through the use of molds or 3D modeling
• Developing unique computer numerical control programs
• Designing innovative cellular manufacturing processes

When considering the R&D Tax Credit, the most important thing to remember is that the hurdle to qualify is probably not as high as you think as even the simplest improvements can be substantially rewarded. R&D isn’t just for scientists. The trial-and-error testing that occurs behind the computer or on the shop floor is just as valid as the research taking place in a laboratory. For manufacturers looking to save some extra cash, exploring the R&D Tax Credit is a shrewd investment.

Want more information on how to benefit from the R&D Tax Credit?

Join us September 24th for a complimentary seminar on valuable tax incentives, including the R&D Credit and the Energy Efficient Commercial Building Deduction (179D).  Click here for details.


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Berntson Porter is excited to announce that we are now part of CBIZ & MHM (Mayer Hoffman McCann P.C.). Together, CBIZ & MHM are one of the nation’s Top Ten accounting providers, and Berntson Porter is honored to be joining them. We are pleased to be able to offer the same people and the same service you’ve known for years under a new name: CBIZ Berntson Porter. Please click here for more information.