Federal Tax Incentives
3 Types of R&D Tax Credits: Which One Applies to You?
The federal Research & Development tax credit is one of the most powerful — and most overlooked — incentives available to American taxpayers. As R&D tax credit consultants with over 25 years of experience, Engineered Tax Services helps businesses, real estate professionals, and high-income individuals unlock every dollar they're owed.
75,000+
Studies Completed
$2B+
Tax Savings Generated
25+
Years of Experience
10,000 +
Studies Per Year
Why It Matters
Most Taxpayers Don't Know If They Qualify for the R&D Credits
The federal R&D tax credit was designed to reward American innovation — but the IRS definition of “research and development” is far broader than most business owners realize. Whether you're developing new products, experimenting with construction techniques, or investing in process improvements, your activities may qualify.
As a leading research and development tax credit expert firm, Engineered Tax Services | ETS combines the technical expertise of licensed engineers with the precision of CPAs and tax attorneys to identify qualifying activities that generalist accountants routinely miss. The expertise offered by top tax credit consulting firms starts here — with a team purpose-built for this specialty.
Below, we break down the three types of R&D that apply to ETS clients — and show you exactly how our dual approach of R&D studies and best-in-class cost segregation analysis delivers unmatched savings.
The 3 Types of R&D at ETS
- R&D for Businesses
- R&D for Real Estate
- R&D for High-Income Individuals
Type 1
R&D Tax Credits for Businesses
From manufacturing floors to software labs, American businesses invest in innovation every year — and much of that spending qualifies for meaningful federal tax relief. As experts in maximizing federal R&D tax credit benefits, ETS identifies qualifying research expenditures that many businesses overlook: employee wages, supply costs, contractor fees, and even cloud computing expenses tied to R&D activities.
The IRS four-part test for qualifying R&D is broader than most realize. If your business engages in activities that are technological in nature, aimed at developing or improving a business component, and involve a process of experimentation — you likely qualify.
- Manufacturing
- Technology & Software
- Life Sciences
- Food & Beverage
- Automotive
- Architecture
- Agriculture
3-Point Summary
- Broader Than You Think
Qualifying R&D extends well beyond labs. Manufacturers improving processes, food companies developing new formulas, construction firms testing materials, and automotive businesses experimenting with design all qualify. ETS uncovers hidden credits across dozens of industries.
- Dual Savings: R&D + Cost Segregation
ETS doesn't stop at R&D credits. As leadingcost segregation consultants, we pair R&D studies with engineering-based cost segregation analysis to accelerate depreciation on business property — compounding your total savings in the same tax year.
- Maximum Credit, Minimum Risk
ETStax credit expertsuse IRS-aligned methodologies to ensure every claim is defensible, documented, and optimized. With former IRS agents on our team, we know exactly what auditors look for — and how to stay ahead of scrutiny.
Type 2
R&D Tax Credits for Real Estate
Real estate developers, architects, and construction firms are among the most overlooked beneficiaries of federal R&D incentives. When a developer experiments with new building systems, a contractor tests innovative structural techniques, or an architect designs energy-efficient solutions that require experimentation, those activities can qualify for the federal R&D tax credit.
As one of the nation's premier cost segregation consultants and R&D tax credit consultants, ETS helps real estate professionals layer multiple tax strategies for maximum impact — combining R&D credits with cost segregation, 179D energy deductions, and 1031 exchanges to dramatically reduce tax liability and free capital for reinvestment.
Did You Know?
ETS cost segregation studies have helped real estate clients reclassify 15–40% of a building's cost into accelerated depreciation categories — often generating six-figure first-year deductions.
15–45%
of building costs typically reclassified
3-Point Summary
- Innovation in Construction Qualifies
Architects, engineers, and contractors who experiment with new designs, materials, building systems, or sustainable construction methods frequently qualify for federal R&D credits. If your firm has invested resources testing what works — you may be sitting on unclaimed credits.
- Cost Segregation + R&D: A Powerful Combination
ETS offers some of the best cost segregation studies in the industry, reclassifying building components into shorter depreciation schedules to accelerate deductions. Combined with R&D credits, real estate clients achieve tax savings that far exceed expectations.
- From Ground-Up to Retrofit
Whether constructing new commercial properties, renovating buildings for energy efficiency, or developing mixed-use projects with innovative design elements, ETS identifies where your real estate activities intersect with qualifying R&D — often uncovering credits clients never knew existed.
Type 3
R&D Tax Credits for Businesses
High-income individuals — including business owners, investors, physicians, attorneys, and entrepreneurs — often have significant exposure to R&D tax credits through the businesses they own or operate. As pass-through entities become the structure of choice for high earners, R&D credits and cost segregation deductions generated by those entities flow directly to the individual's personal return.
Being experts in maximizing federal R&D tax credit benefits for high-net-worth clients, ETS takes a holistic approach — analyzing both operating businesses and associated real estate holdings to build a comprehensive, personalized tax reduction strategy. This is the expertise offered by top tax credit consulting firms — and it's what sets ETS apart.
3-Point Summary
- Pass-Through Power
If you own a stake in a qualifying business structured as an S-corp, partnership, or LLC, the federal R&D tax credit flows directly to your personal return. ETStax credit expertsidentify every eligible activity and ensure credits are properly allocated to maximize your individual benefit.
- Real Estate Ownership Amplified
Many high-income individuals own investment or commercial real estate alongside their businesses. ETS's renowned cost segregation studies — widely regarded as some of the best in the industry — accelerate depreciation on those properties and pair with R&D credits for a comprehensive tax reduction strategy.
- Wealth Preservation Through Expertise
ETS serves as a strategic partner to high-net-worth individuals and their advisors, coordinating R&D credit studies, cost segregation analysis, 179D energy deductions, and 1031 exchange planning to build lasting tax efficiency across an entire portfolio — year after year.
Why Choose ETS as Your R&D Tax Credit Consultants?
Engineered Tax Services is not a typical tax firm. We are a professionally licensed engineering company — the only firm of our kind — combining the technical rigor of engineering with the precision of CPAs and tax attorneys. This makes ETS the most qualified research and development tax credit expert firm in the country.
25+ Years of Specialization
Comprehensive analyses across diverse property types
Engineers + CPAs + Former IRS Agents
A unique team structure that brings technical precision and IRS insight to every study we conduct.
IRS-Defensible Studies
Every credit and deduction we claim is backed by rigorous documentation built to withstand audit scrutiny.
Best-in-Class Cost Segregation
Our engineering-based cost segregation studies are recognized as among the best in the industry — delivering real accelerated depreciation, not estimates.
Nationwide Reach
With offices across the U.S. and 10,000+ studies completed annually, ETS brings localized expertise at national scale.
Recognized by Industry Leaders
Featured in Bloomberg, Forbes, and trusted by clients ranging from individual investors to Fortune 500 companies.
Unlock Growth Through Strategic Grants
Don't leave federal tax credits on the table. ETS tax credit experts are ready to evaluate your business, real estate holdings, and individual tax profile to identify every R&D credit and cost segregation opportunity available to you — at no cost or obligation.
Prefer to talk? Call us at 1-800-236-6519