R&D Tax Credits for the Tool & Die Casting Industry

Refunds are available for companies performing research within the Tool & Die Casting 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 tool & die casting 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

• Automating machining processes to optimize die casting times as well as reduce labor costs
• Designing, developing, and testing prototypes
• Developing operational efficiencies with the molding process
• Developing safety measures within the tool & die casting process
• Drafting new parts on computer-aided design (CAD) programs to model product specifications and functionalities
• Improving machining processes to ensure consistency among products
• Testing alternative or new raw materials to work with to improve product performance and useful life

Potentially Qualifying R&D Job Titles

• Design Engineer
• Die Cast Engineer
• Computer Numerically Controlled (CNC) Programmers
• Mechanical Engineer
• Manufacturing Engineer
• Process Engineer
• Quality Engineer

AMT Offset

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.