R&D Tax Credits for the Machining Industry
Refunds are available for companies performing research within the Machining Industry. 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 machining 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
- Coding and programming for machinery communication
- Computer-aided design (CAD) and computer-aided manufacturing (CAM) modeling and simulation
- Computer numerically controlled (CNC) programming
- Designing for tight tolerances
- Developing prototype tooling
- Developing robotics and automated technology
- Eliminating or minimizing warpage in welding and fabrication processes
- Experimenting with different types of materials
- Maintaining speed of milling process without breakage
- Maintaining uniform constraints in the lathing process
- Maximizing feeds and speeds while ensuring quality and integrity of the part
- Modeling, simulation, or systematic trial and error
- Special fixture requirements
Potentially Qualifying R&D Job Titles
- Computer Numerically Controlled (CNC) Programmers
- Engineering Managers
- Engineering Supervisors
- Mechanical Engineers
- Manufacturing Engineers
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.
Up to $250,000 in Payroll Tax
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 eligibility.
Estimate Your Benefits with our FREE Calculators
Use our calculators for an estimate of state and federal R&D tax credit benefits or to determine if you can offset payroll tax using the R&D tax credit. It's easy to use and free. If at any time you have questions, contact us. We are here to help you realize your maximum tax benefit.
Get a Free Download of this Research & Development One Pager
Research and Development Tax Credit Insights
Kansas Issues New Notice to the Research and Development Tax Credits Thought Leadership by Jonathan Tucker, Principal – Research and Development Tax Credit Services As certified public accountants, staying abreast of changes in tax laws and regulations is crucial to best serve your clients. In this blog, we’ll dive into the recent amendments by House Bill … Read More
KBKG Tax Insight: IRS Releases Guidance on Section 174 R&E Expenses Monday, September 11, 2023 By Kevin Zolriasatain | Principal, Research & Development Tax Credits On Sept. 8, 2023, the Internal Revenue Service (IRS) unveiled Notice 2023-63. This significant and eagerly awaited update to tax regulations under Section 174 marks a pivotal moment in the realm … Read More
Wisconsin Department Revenue Updates Publication 131 – R&D Tax Credits Thought Leadership by Jonathan Tucker, Principal – Research and Development Tax Credit Services | KBKG Understanding tax incentives and research credits can often be as intricate as deciphering a complex puzzle. Fortunately, the Wisconsin Department of Revenue has developed the newly updated Publication 131, a … Read More
How Form 6765 Can Benefit Your Business Form 6765 is a document the Internal Revenue Service published as part of the tax code. The official name of the document is Credit for Increasing Research Activities. However, it is more informally called the R&D Tax Credit Form. It can be a valuable source of savings for your … Read More
KBKG to Host Webinar Series with AIA Los Angeles PASADENA, Calif. – 7/26/2023 – KBKG, a leading provider of turnkey tax services and solutions, is set to host a series of webinars alongside AIA Los Angeles on August 1 and August 8. The two-part series is to educate architects on effective cost-saving strategies through various … Read More
Everything You Need To Know About R&D Tax Credits Business owners often consider taxes an inconvenient but necessary part of everyday operations. However, a better understanding of taxes can save you money by taking advantage of various credits, such as the R&D tax credit. How does the R&D tax credit work? Get an in-depth look into everything … Read More
R&D Tax Credit for Software Development Has your company paid to create or improve software? You may be eligible for the research and development tax credit for software companies. The government offers incentives for R&D software development, both domestically and internationally. What Is R&D Software Development? Companies do R&D projects to acquire knowledge as a long-term … Read More
Understanding the R&D Tax Credit for Manufacturing Innovation is at the heart of every successful manufacturing company. Businesses must find ways to improve, create more efficient processes, and develop new and valuable products. That innovation can be expensive. R&D tax credits for manufacturing can be helpful. Still, too many companies don’t know how to take advantage … Read More
R&D Tax Credits for Small Businesses Did you know that businesses that engage in research and certain manufacturing processes may be eligible for a tax credit? The Research and Development tax credit, or R&D credit, may be able to reduce your small business’s tax burden and allow you to obtain funding for further research. To … Read More
Boost to Businesses – Build It In America Act by Kevin Zolriasatain | Principal, KBKG, 6/15/2023 Tax Insight: Research and Development (R&D) Tax Credit / Research and Expenditures On Tuesday, June 13, the House Ways and Means Committee approved three bills: the Small Business Jobs Act, or H.R. 3937, and the Build It in America Act, or … Read More