Medical equipment encompasses anything from simple tools to advanced molecular imaging systems. Medical equipment manufacturers employ teams of engineers, CAD designers, and software developers who work in tandem with healthcare professionals to develop new products and instruments that enhance patient care and outcomes. Many steps in the process - concept, design, development, manufacturing, and testing - are considered research and development (R&D) for tax purposes, and a significant portion of the associated costs can be offset through 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.
Example activities that qualify:
- Developing novel image processing or machine-learning software
- Creating new or improved microfluidic systems
- Designing improved cell extraction, separation, and purification instrument prototypes
- Developing and testing manufacturing protocols and procedures
- Creating medical-grade point-of-care monitors and/or information storage systems
- Implementing robotics or automation in the manufacturing process to increase efficiency and output
Do you have these job titles on your payroll, or do you hire third-party contractors to do these jobs?
- Device Engineers
- Electrical Engineers
- Industrial Engineers
- Manufacturing Engineers
- Production Technicians
- QA/QC Staff
- R&D Engineering Technicians
- Software Developers