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Manufacturing Innovation Deserves More Than Recognition—It Deserves Tax Incentives
Whether you’re improving products, optimizing production processes, implementing automation, or engineering new solutions, your work may qualify for valuable R&D tax credits. We’ve helped manufacturers identify millions in tax savings that can be reinvested into growth, technology, and operations.
Case Studies
R&D CREDIT VALUE:
$1,000,000
ANNUAL REVENUE:
$63 Million
This company was challenged with overcoming original design flaws of a half-bore. The experimentation
process led to a two-part clamped fixture. After 31 different prototypes, they were able to move forward
with the production part approval process.
R&D CREDIT VALUE:
$1,000,000
ANNUAL REVENUE:
$63.1 Million
During a particularly difficult product design that involved lengthy trial and error, a team of precision
engineers discovered a new manufacturing process for a half bore using a clamp and a custom fixture.
Another challenge tasked the company’s precision machinists with improving a part that had four difficult-
to-produce ports due to the double-angle seal at the top.
R&D CREDIT VALUE:
$2,700,000
ANNUAL REVENUE:
$40 Million
This company designed and manufactured a skidded, structural steel trap for one of their customers
in the oil and gas industry. The steel trap was required to have a volume of 28 gallons to comply with
customer specifications. The component also had to meet ASME and AWS compliance standards
and was designed and manufactured so that it could be assembled in the fields.
How Does The Research & Development
Tax Credit Work?
STEP 1
IDENTIFY QUALIFIED
RESEARCH EXPENSES
(QREs)
Wages, Supplies, Cloud Computing, Contractor Costs
STEP 2
CALCULATE THE
TAX CREDIT
PERCENTAGE
Determine Credit Amount Based on Eligible Expenses
STEP 3
APPLY AS
DOLLAR-FOR-DOLLAR
REDUCTION
Lower Income Tax Liability
Carryforwards
Maximize Innovation, Minimize Taxes.
See if your business qualifies
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Trending R&D Topics
Get the insights and documentation templates you need to identify qualifying activities and streamline your credit claims process.
Frequently Asked Questions
What industries qualify for the R&D tax credit?
Traditional “R&D” industries, such as engineering and software development, are only the tip of the iceberg for the types of companies that can claim the R&D Tax Credit. Industries that can qualify for the credit include:
- Aerospace
- Agriculture
- Automotive
- Building System Controls
- Chemical
- Engineering
- Food & Beverage
- Life Sciences
- Manufacturing
- Metals
- Oil & Gas
- Software
What activities qualify for the R&D tax credit?
To qualify for the R&D Credit, your activities must meet all elements of the four-part test:
- Development or improvement of business components, such as products, processes, software, techniques, inventions, or formulas, held for sale, lease, or license
- Technological in nature, i.e. rooted in a hard science such as physics, biology, computer science, or engineering
- Elimination of technical uncertainty related to functional elements of a business component’s design, excluding non-scientific areas such as marketing or consumer preference
- Process of experimentation to resolve technical uncertainty – even iterative trial-and-error can qualify
How to claim the R&D tax credit?
The formal claim process requires submitting IRS Form 6765 (Credit for Increasing Research Activities) with your company’s annual tax return. You can also claim credits for prior open tax years through amended returns.
Recent changes to Form 6765 require you to provide a basis for qualification, highlighting how you arrived at the claimed credit value and how activities were tied to projects. Working with experienced professionals ensures you’re presenting the proper documentation of your research activities, which can include employee time tracking, design documentation, testing reports, and financial records.
How far back can you claim R&D tax credits?
Companies can typically claim R&D tax credits for the current tax year plus the previous three tax years. This lookback period allows businesses to recover previously unclaimed credits, but only within a specified timeframe.
Does alliant work with CPAs?
Yes, we have partnered with over 4,500 CPA firms to provide comprehensive R&D tax credit services. We work collaboratively with accounting professionals to ensure proper documentation, compliance, and maximum benefit for their clients while maintaining the highest professional standards.
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