Manufacturer Incentive • Federal Tax Credit

R&D Tax Credits for Manufacturers: Driving Growth Through Innovation

The Research & Development (R&D) Tax Credit is designed to reward U.S. businesses that improve products, processes, tooling, and technology through real-world experimentation. You don’t need a lab coat—if you’re solving technical uncertainty and iterating toward a better outcome, you may have qualifying activity.

  • Fast eligibility review focused on manufacturing realities (process + product improvements).
  • Documentation guidance that’s practical—no “perfect paperwork” required to start.
  • Time-sensitive opportunity to revisit prior years and current-year strategy.
Schedule a Consultation Start Your R&D Credit Review

Educational information only — not tax or legal advice. Eligibility depends on facts and circumstances.

What is the Research & Development (R&D) Tax Credit?

The R&D Tax Credit is a valuable federal incentive for businesses that invest in qualified research activities in the U.S. For manufacturers, “R&D” often looks like engineering and production problem-solving: improving cycle time, boosting yield, reducing scrap, optimizing tolerances, and testing new methods or materials.

Plain-English definition

If your team is solving technical uncertainty and iterating toward a new or improved product or process, you may have activity that qualifies.

The “Four-Part Test” (Section 41)

The IRS evaluates qualified activities using a standard framework. Here’s the practical version:

1) New or improved

You’re developing or improving a product, process, technique, formula, software, or workflow.

2) Technical foundation

The work relies on principles of engineering, physical science, biological science, or computer science.

3) Uncertainty

At the start, it’s not obvious how to achieve the result (design, capability, method, or performance).

4) Experimentation

You test alternatives—prototypes, trials, simulations, pilot runs, iteration, and refinement.

Why manufacturers are strong candidates

Manufacturing teams routinely tackle technical uncertainty and iterate toward better outcomes—often as part of normal operations. Examples we commonly review:

Product innovation

  • Redesigning components for durability, reliability, or performance
  • Material substitutions and performance testing
  • Prototype runs, fit/finish improvements, tolerance improvements
  • New product lines or configurable variants

Process & production improvements

  • Cycle time reduction, yield improvement, scrap reduction
  • Automation (robotics, controls), fixture and tooling development
  • Reducing downtime through redesigned methods or equipment changes
  • Quality improvements through testing and iterative refinement

2025 update: time-sensitive changes to federal R&D incentives

In 2025, federal legislation restored immediate deductibility for domestic research costs (with important transition rules), which can improve the overall value of pursuing R&D incentives and may allow businesses to revisit prior years. This is one reason many manufacturers are taking a fresh look right now.

What this can mean for you

  • Potentially deduct eligible domestic research costs immediately (subject to rules and elections).
  • Revisit prior-year research costs and evaluate transition opportunities.
  • Pair stronger expense treatment with a well-supported Section 41 credit approach where applicable.

Your CPA should confirm eligibility and filing approach. We can coordinate and provide organized support documentation.

How the review works

We keep it structured and efficient, with a focus on what the IRS cares about and what’s realistic for a manufacturer to produce.

1) Intake

Quick call to understand your operations, projects, and timeline.

2) Eligibility mapping

We align projects to the four-part framework and identify strongest candidates.

3) Documentation support

We help gather the right evidence—without overburdening your team.

4) Coordination

We coordinate next steps with your CPA/filing team for implementation.

Start your R&D credit review

Submit the form and we’ll reach out to schedule a short discovery call. If you’d rather pick a time now, you can also schedule directly.

Schedule a Consultation Back to Top

Tip

If you’re unsure whether your activities qualify, submit anyway. We’ll help you triage quickly.

Request a Review

Name(Required)
Have you claimed any R&D credits in the past?(Required)
Are your employees located in the US?(Required)
Is your R&D activity domestic?(Required)
Do you currently have an R&D provider and if so who?(Required)
Do you have multiple US locations?(Required)
What year was the company founded?(Required)
Is your company profitable?(Required)
Would you like to schedule a discovery call?
This field is hidden when viewing the form

By submitting, you agree we may contact you about your request. We won’t share your information.