Compounding pharmacies are constantly innovating by customizing drug formulations to accommodate specific patient needs. Common research and development (R&D) activities include assessing the active ingredient(s) and excipients, solubility, and the appropriate dosage and route of administration. Companies that conduct research and development (R&D) for new and complex medications can offset costs with the R&D Tax Credit.
Employee wages, raw materials & supplies, and third-party contractor costs associated with R&D activities are considered qualified research expenses (QREs). Companies can receive refunds of up to 22% of total QREs through federal and state tax credits, depending on the state in which your business operates.
Examples of qualifying activities:
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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!