Does Your Industry Qualify for R&D Tax Credits?
Yes, your industry probably qualifies. The federal R&D tax credit covers 30+ industries:
- Software, manufacturing, engineering, aerospace, food and beverage, agriculture, and dozens of others.
- Strike has delivered over $300 million in credits for 1,100+ clients.
- Find your industry below to see qualifying activities and example credits delivered.
Authorized under IRC Section 41.
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Clients
30
+
Industries
Zero upfront fees. Free unlimited examination defense.
EXPLORE
Which Industries Qualify for R&D Tax Credits?
Each industry below has a dedicated qualification framework. Click through to see qualifying activities, sub-industry coverage, and example credits delivered.
Engineering
In the precision-driven realm of engineering, where finite element analysis optimizes bridge spans, IoT-integrated systems revolutionize manufacturing, and bio-inspired materials enhance prosthetics, your technical advancements qualify for robust federal and state tax incentives under IRC §41.
Agriculture
The food and beverage industries are constantly evolving to keep pace with consumer tastes and trends. The research and development your company is investing in could translate into significant tax savings with the R&D Tax Credit.
Food & Beverage
The food and beverage industries are constantly evolving to keep pace with consumer tastes and trends. The research and development your company is investing in could translate into significant tax savings with the R&D Tax Credit.
Alcoholic Beverages
The global adult beverage market is growing, and the continual innovations required for companies to stay competitive require significant investments in R&D. Your company can recoup up to 20% of these expenses through federal and state tax credits.
Aerospace & Defense
The inherent innovation required to propel these industries forward makes them ideal candidates for claiming the R&D Tax Credit. Technological advances, contract work for NASA, the DOD, or other government agencies, could translate to increased capital to reinvest in your company.
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Software & Technology
Most stages of the software development process qualify as R&D, and software companies recoup some of the highest – on average up to 55% – of their R&D expenditures compared to other industries. Planning, creating, improving, testing, and implementing are all qualifying activities.
Manufacturing
It doesn’t take reinventing the wheel to qualify for R&D Tax Credits. If your company has improved upon an existing process, made it more efficient, increased output, added automation capabilities, or any number of other activities related to the manufacturing of new or existing products, you most likely qualify.
Architecture
Building design has evolved - LEED-certified, green, energy efficient, and many others - and so have the processes needed to implement and deliver your client’s vision. Your innovation could be rewarded with significant tax incentives from the IRS.
Industrial Hemp & CBD
Are you growing, extracting, or formulating? Are you a company optimizing crop yield through the use of novel seed genetics? Are you developing innovative extraction techniques for industrial hemp? Are you making CBD formulations or consumables? These activities and many others may qualify for significant tax credits as a result of the 2018 Farm Bill.
THE PATTERN
What Qualifies as R&D Across Industries?
Product, process, and manufacturing development
- New product designs and prototypes
- Reformulations and improvements to existing products
- Manufacturing process optimization and automation
- Custom tooling, jigs, fixtures, and equipment design
Software, systems, and engineering
- New algorithms or data architectures
- Cloud and infrastructure design
- Integration of disparate systems
- Civil, structural, mechanical, and electrical engineering work
Materials, formulation, and applied research
- New material composition and testing
- Recipe and formulation development
- Performance under stress and environmental testing
- Sustainability, shelf-life, and reliability work
R&D Tax Credits by Industry: Frequently Asked Questions
No. The R&D tax credit applies to any U.S. business that develops or improves products, processes, software, formulas, or techniques through systematic experimentation. The IRS does not maintain a list of qualifying industries. The qualifying factor is the activity, not the industry classification.
Strike has delivered R&D credits for companies in industries beyond those listed here. Construction, e-commerce technology, life sciences, oil and gas, telecommunications, packaging, and many other sectors regularly qualify. If you develop or improve anything technical in your business, contact Strike for a free 15-minute assessment.
The federal R&D tax credit under IRC Section 41 is the same calculation regardless of industry. What differs by industry is the type of qualifying activities, the typical credit range, and the documentation needed. Strike maintains industry-specific qualification frameworks for each major sector.
Credit size depends on qualified research expenses (mostly wages), not industry classification. Industries with high engineer-to-revenue ratios such as software, biotech, and aerospace typically generate larger credits per company. Manufacturing, food and beverage, and agriculture often have substantial credits when documentation is properly captured.
Possibly. The party that bears the financial risk of the research and retains substantial rights to the result generally claims the credit. Contract research relationships require careful analysis. Strike reviews contracts and project structures to determine the correct claimant.
No. Patents are not required. The IRS Four-Part Test requires only that you addressed technological uncertainty through systematic experimentation. Trade secrets, internal-use software, and unsuccessful experiments all qualify when the four-part test is satisfied.
Yes. Software development is one of the largest categories of qualifying R&D activity under IRC Section 41. Activities such as building new SaaS platforms, designing data architectures, integrating systems, training machine learning models, and developing internal-use software all qualify when they meet the IRS Four-Part Test. Strike has delivered software R&D credits across cybersecurity, fintech, healthtech, and AI startups.
Yes. Manufacturing is consistently one of the highest-value verticals for R&D credits. Qualifying activities include new product design, manufacturing process optimization, automation engineering, custom tooling and jig design, materials testing, and quality control system development. Strike has delivered seven-figure credits to precision manufacturers, plastic injection molders, semiconductor fabricators, and custom equipment makers.
COMMON MISPERCEPTION
Why Most Companies Think They Don't Qualify for R&D Tax Credits
In the United States, the term "R&D" is often associated with laboratory research, scientific papers, and activities performed separately from day-to-day business. The federal credit is much broader. The IRS Four-Part Test under IRC Section 41 covers commercial development work, including building products, optimizing processes, integrating systems, and improving formulations. These activities qualify even when they happen during normal client work.
A construction firm experimenting with new materials qualifies. A craft brewery refining a fermentation process qualifies. A custom manufacturer optimizing tooling qualifies. A software team building a new algorithm qualifies. None of them are doing what most people imagine when they hear R&D, but all of them meet the statutory test.
REAL RESULTS
R&D Tax Credits We Have Delivered Across Industries
$
3.7
m
Robotics Firm
35 employees. 70% of wages and 90% of expenses qualified. Custom robotics design, production, and integration.
$
668
k
Cybersecurity Company
SaaS firm with patent-pending encryption development. Qualified for federal and state credits.
$
657
k
Automotive Manufacturer
30 employees. Custom racing engine design and manufacturing innovation qualified at 62% of wages.
TIME SENSITIVE
OBBBA Recovery for Industries That Skipped 2022-2024 Credits
Many companies in software, manufacturing, and engineering reduced or skipped R&D credits during 2022 through 2024 because of Section 174 amortization. The One Big Beautiful Bill Act (OBBBA), signed July 4, 2025, retroactively repealed Section 174 amortization for businesses with average annual gross receipts of $31 million or less. Eligible companies can amend 2022, 2023, and 2024 returns and recover credits and refunds. Filing deadlines for the retroactive election fall within one year of OBBBA enactment.
Find Your Industry's R&D Tax Credit Opportunity
Strike Tax Advisory has delivered R&D credits across more than 30 industries. Zero upfront fees. Free unlimited audit defense.