Whether or not a company qualifies for the Research & Experimentation Tax Credit depends on many factors.  Some factors include issues related to base period activity or if the company has the minimum amount of documentation necessary to make their case to the IRS.  These factors are almost impossible to determine until a detailed study has been performed.

There are several indicators of qualified research that can help identify excellent candidates for a R&D Tax Credit Study. 

These indicators of qualified research include:

• Degreed engineers or scientists on staff
• Operates in a manufacturing industry with
  • new materials(e.g.- composites)
  • electronics
  • few competitors
• Patentable products or production methods
• Has new/continuous improvements to products and/or processes
• Operates in industry where prototyping is common
  • medical,
  • aerospace,
  • automobile, etc.
• Is awarded government R&D projects, from program such as: SBIR, STTR
• Engages in Continuous Quality Improvement efforts 
• Manufactures simple products in a highly automated system
• Creates high warranty costs due to improper product/process design
• Develops software using new algorithms, techniques or architectures