R&D Tax Credits for the Chemical & Formula Industry

Refunds are available for companies performing research within the Chemical & Formula Industries. The research credit provides dollar-for-dollar cash savings each year for companies performing activities related to the development of new or improved products and processes. These benefits could provide much needed cash to hire additional employees, increase R&D, expand production facilities, etc.

Many companies involved with chemicals & formulas are unaware that their efforts within designing and developing their products can yield a large amount of research credits. Examples of R&D activities related to the industry as well as potentially qualifying job titles are listed below.

Examples of Qualifying R&D Activities

Automation of internal processes by developing and implementing new hardware and software systems
Development and evaluation of new, improved, or more reliable raw materials, products, or formulas
Experimentation to increase product yield, improve shelf-life, or discover new applications for existing chemicals
Generating pilot batches of new products for testing and validation
Refining manufacturing methods to improve efficiency or reduce environmental impact
Support of direct research activities, such as quality testing, maintaining lab equipment, data collection, and regulatory compliance work

Potentially Qualifying R&D Job Titles

Analytical Chemist/Scientist
Chemical Engineer
Formulation Chemist/Scientist
Lab Assistant, Lab Technician
Quality Assurance/Control (QA/QC) Analyst, Associate, Chemist/Scientist, Manager
Research Associate, Research Scientist

AMT Offset up to $250,000 in Payroll Tax

For tax years beginning after December 31, 2015, eligible small businesses (those with $50 million or less of gross receipts) may claim the research credit against AMT liability. In addition, qualified start-up companies may elect to use up to $250,000 of the research credit against payroll taxes.

Treasury Regulations have substantially broadened the range of taxpayers who are eligible for the credit. Start-ups to publicly traded businesses who were previously unable to realize a benefit from this lucrative tax credit should reassess their eligibilities.

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There’s Still Time to Claim the R&D Tax Credit on Extension [Infographic]

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The Research & Development Tax Credit is a federal benefit (also available in many states) that was enacted to promote growth, innovation, and inspire advancements in all areas and facets of business. The credit is an undoubtedly beneficial incentive for businesses large and small. However, many companies are hesitant to take advantage of the credit … Read More

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Calculating and documenting the Internal Revenue Code Section 41 Credit for Increasing Research Activities (“Research Credit” or “R&D Credit”) is an intricate and often burdensome undertaking. This process is complicated during the throes of busy season. Fortunately, the Internal Revenue Service (“IRS”) has afforded taxpayers additional time to claim a R&D credit via making a … Read More

Own a Start-up or Small Business? You May Qualify for Federal Research Credits.

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Billions of dollars worth of research credits go unclaimed every year in the United States. This is primarily due to many taxpayers not being aware of the credit or not quite understanding it. In addition, when a reference is made to research and development (“R&D”), taxpayers often think about lab coats and test tubes. In … Read More

R&D Tax Credits for the Chemical & Formula Industry

Examples of Qualifying R&D Activities

Potentially Qualifying R&D Job Titles

AMT Offset up to $250,000 in Payroll Tax

R&D Experts

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