R&D Tax Credit for Engineering Firms

Engineering firms often do not realize that they are eligible for the R&D tax credit. The Research tax credit allows companies to realize tax savings, increase cash flow and stay competitive in the marketplace. Many of the qualifying activities are considered day-to-day operations for the construction industry. Engineering firms with a design-build team and engineers on staff will likely qualify for this incentive.

The benefits can be significant and are efficient to realize through our services. The R&D tax credit can provide a hidden but immediate source of cash for construction firms from prior years, plus a significant reduction to current and future years’ federal and state tax liabilities.

To qualify for the Research and Development Tax Credit, you will need to meet three cost components:

  1. Expense of direct wages;
  2. Expense of supplies consumed; and
  3. Cost of contract research.

Typical Qualifying Research Tax Credit Activities:

  • BIM Modeling – Designing a building collaboratively with one system of computer models
  • Determining alternative structural design
  • Improving or determining substitute heating and air conditioning systems
  • Improving or developing substitute ventilation
  • Developing or improving lighting
  • Sustainable design
  • New technology
  • Value engineering
  • Development of substitute electricity conduction systems
  • Space management to determine type and scale of facilities.
  • Design performance testing
  • Development of alternative water flow/plumbing systems
  • Integrating transport systems into the design of a structure
  • New material testing – measurement of the characteristics and behavior of such substances
  • Environmental design
  • Environmental impact studies
  • Incorporating waste disposal processes into the structure

Our Research & Development Tax Credit practice consists of engineers, CPAs, and attorneys who have extensive experience conducting R&D Tax Credit Studies at both the federal and state level. Our process begins with a free assessment to ensure that the company qualifies for the credit and would be able to utilize them. Each of our studies includes a site visit to help facilitate the study process. We also include audit support with all of our studies. This is a conservative federal and state incentive that was just made permanent by Congress as part of the 2015 PATH Act. Contact ETS for more information at 800-236-6519 or email here.

 

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Additional Specialty Tax Services for Engineers and Architects

Learn More about the Research & Development Tax Credit