The services provided by architects are wide-ranging and varied. From site-use, environmental, and energy studies to the efforts required to design a new structure, many activities are considered research and development (R&D). The architectural work involved in site planning, building design, and construction documentation falls under qualified research activities, and can be claimed with the research and development tax credit.
Engineers develop and improve products or systems that are optimally designed to meet efficiency standards, achieve applicable regulations, and satisfy client specifications. Many of the expenditures (primarily employee wages) required to create or improve on products or processes can be claimed as qualified research expenses (QREs). In addition to the federal credit, many states offer tax breaks. Pre-revenue companies and start-ups with less than five years of revenue can use the federal R&D tax credits to offset future payroll taxes.
Example activities that qualify:
Do you have these job titles on your payroll, or do you hire third-party contractors to do these jobs?
Unsure of whether your architectural designs or engineering projects qualify? The innovations your company has been working on may be eligible for significant tax breaks. Strike Tax Advisory employs experts with years of experience in research and development tax credits. At Strike, we work on a success-based fee structure enabling businesses in the architecture and engineering industries to claim R&D credits/refunds without any out-of-pocket costs. We offer complete audit protection and a money-back guarantee. Use our R&D Tax Calculator to estimate your potential benefit, and partner with Strike to enjoy your tax incentives with no up-front costs. Contact one of our experts today.
Federal and state tax credits were created to incentivize companies across multiple industries to keep high-tech jobs in the United States. Companies can claim employee wages, supplies & raw materials, computer rental costs, and third-party contractor expenditures incurred throughout the R&D process. Current law permits companies to amend prior-year tax returns (going back three years), offering additional financial benefits from tax refunds. If you cannot use the R&D credits immediately, the IRS allows taxpayers to carry credits forward up to 20 years.
Average amount of total business expenses that typically qualify
2016-2019 Fed/CA R&D tax credits for a civil/structural engineering firm
Percentage of payroll qualified toward credit for actual architecture client
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Benefits for the R&D Tax Credit vary from state to state. Get an accurate estimate of what your potential state tax credit!