Architecture & Engineering
Stats at a Glance
36%
Average amount of total business expenses that typically qualify
$1,000,000+
2016-2019 Fed/CA R&D tax credits for a civil/structural engineering firm
63%
Percentage of payroll qualified toward credit for actual architecture client
The services provided by the architect are wide-ranging and varied. From site-use, environmental, and/or energy studies to activities required to complete the design of a new/improved 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 R&D Tax Credit.
Engineers develop 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 a new process or product, or improve upon an existing process or product, 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.
The following industries have claimed significant R&D tax credits and received millions in capital to reinvest in their workforce, infrastructure, and continued innovation:
Architecture
Engineering:
Aerospace
Agricultural
Biomedical
Civil / Structural
Electrical
Environmental
Mechanical
Product
Example activities that qualify:
- Designing building facades and floor plans
- Developing building-specific, energy-efficiency designs
- Implementing water distribution systems for municipalities and water districts
- Designing electrical insulation, HVAC, or structural systems
- Evaluating alternative heating and cooling systems
- Creating novel space utilization
- Improving designs to meet functional requirements
Do you have these job titles on your payroll, or do you hire third-party contractors to do these jobs?
- Building Information Modelers (BIM)
- C-Suite
- CAD Designers
- Drafters
- Electrical Engineers
- Industrial Engineers
- Mechanical Engineers
- Structural Engineers
- Principals
- Project Managers
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 Advisory, LLC employs tax experts with years of experience in R&D 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 claim your tax credits with no up-front costs. Contact one of our experts today.
The R&D Tax Credit was 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.
Journal articles linked to page:
Do You Qualify for R&D Tax Credits?
