The work of mechanical engineering firms is integral to a variety of industries, including energy, health, aviation, product development, manufacturing, construction, and many others. These firms make significant investments in research and development (R&D) to meet client demands and product specifications. Some of the costs incurred during R&D activities can be recouped through the R&D Tax Credit.
Employee wages, raw materials and 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:
Do you have these job titles on your payroll, or do you hire third-party contractors to do these jobs?
Benefits for the R&D Tax Credit vary from state to state. Get an accurate estimate of your potential state tax credit!