How to Claim the Research & Development Tax Credit for Your Business, Regardless of Industry

By: Chelsea Smith, Tax Manager

Your business is constantly evolving and innovating, you deserve to get the appropriate rewards for your hard work. A great way to improve your bottom line is by finding as many tax credits as possible. Don’t leave money on the table. Your business may qualify for the Research & Development Tax Credit, even if you’re not in “high-tech.”

The Research & Development — or R&D, for short — Tax Credit rewards businesses for developing or improving products, processes, or software. It’s not just for scientists in labs—companies in many other industries are also taking advantage of these incentives.

The key to securing the R&D Tax Credit is in identifying the qualifying activities and reporting them based on the proper qualifying standards. At Squire, we specialize in helping businesses like yours maximize their potential savings by identifying qualifying activities and guiding you through the process.

Who can benefit from the R&D Tax Credit?

If your business has invested in activities like enhancing processes to improve efficiency, developing new or improved products, conducting software development or performing engineering or architectural design, you could be eligible for the R&D Tax Credit.

Again, you don’t need to employ a laboratory full of scientists to claim the tax credit — although it doesn’t hurt if you do. Companies in industries such as manufacturing, software development, food and beverage production, construction, architecture, engineering and pharmaceuticals frequently take advantage of their tax-eligible activities, sometimes in creative and compliant ways.

 Examples of tax credit qualifying activities

While qualification criteria are well-defined by the IRS, many businesses find ways to claim their R&D tax credit. Even if you don’t see your business or industry listed below, reach out to the tax experts at Squire, we’ll help you identify the activities you may have overlooked.

Here are some examples of R&D tax credit qualifying activities that could apply to your specific industry, or broadly across many different ones:

 Software Development

• Developing proprietary software for internal use or customer-facing platforms.
• Enhancing cybersecurity measures or integrating artificial intelligence (AI) solutions.
• Automating internal processes using custom-coded solutions or robotics.

 Manufacturing Process Optimization

• Implementing lean manufacturing techniques to reduce waste.
• Developing new processes for assembling products.
• Experimenting with automation, robotics, or innovative machinery.

 Food and Beverage Innovations

• Experimenting with new recipes or food formulations to meet dietary trends.
• Developing longer-lasting, shelf-stable packaging solutions.
• Enhancing manufacturing processes for higher production efficiency or allergen safety.

 Construction and Architecture

• Engineering innovative building designs to improve energy efficiency.
• Experimenting with new materials, like sustainable concrete or lightweight composites.
• Testing 3D printing techniques for construction projects.

 E-commerce and Retail

• Optimizing online platforms with proprietary algorithms or AI-driven features.
• Developing augmented or virtual reality shopping experiences.
• Innovating inventory management systems using predictive analytics.

 Creative Industries

• Experimenting with new animation techniques or visual effects in media production.
• Creating innovative user experiences for games or virtual reality environments.
• Developing new tools or frameworks for graphic design or video editing.

How to claim the credit?

What’s the process? Squire makes it easy. We know your time is valuable. That’s why we handle the hard work, from identifying qualifying activities to preparing detailed reports for your tax filings. We start with a brief conversation to assess your eligibility. We request some basic data about your projects and expenses. Then, our team calculates your potential savings and delivers a clear, detailed report to help you claim the credit. Most businesses see significant savings with minimal effort on their end with our help.

So why partner with Squire? Well, why not? As trusted advisors, we’ve helped countless businesses uncover valuable tax credits while navigating the complexities of compliance. Our process is seamless, efficient, and designed to maximize your return.

Contact us today to learn how your business can benefit.