Research and Development (R&D) Tax Credits are dollar-for-dollar tax savings for companies that develop new or improved business components. Businesses must report the job titles of everyone involved in R&D to successfully claim tax credits. Here are some job titles companies can use to increase their chances of a successful claim.
Designers: Some businesses may be unaware that designing activities qualify as R&D. By nature, designers must constantly iterate on their designs. Designers perform several functions that encourage innovation, including designing new products, refining existing structures, and testing new methods. Designing new business components meets the IRS four-part test of uncertainty, experimentation, qualified purpose, and being technologically oriented.
Engineers: Engineers are responsible for creating new products or services and implementing them, making it likely that their work will help a business qualify for R&D tax credits. Typical R&D activities for engineers include CAD modeling, determining alternate structural designs, making products more environmentally friendly, and information modeling.
Scientists: If a company is in the sciences, many activities count as qualified research activities (QRAs), including improving existing products to increase their shelf life and effectiveness and reducing side effects. Additional activities that may qualify are designing new drug delivery systems and conducting clinical trials.
Computer Programmers: Computer programmers perform several activities eligible for R&D tax credits, including coding, programming, beta testing, and more. These activities improve upon existing products and eliminate uncertainty, making them suitable to use for a tax credit claim.
Additional industry-specific job titles can be part of an R&D tax credit claim. Many of these positions are in industries not commonly viewed as having R&D, exemplifying a broad range of job titles that can be used for a claim.
Industry-Specific Job Titles
Here is a sample of additional titles for other common industries that qualify for R&D tax credits.
Aerospace & Defense
– Aerospace Engineer
– CAD Designer
– Electrical Engineer
– Engineering Manager
– Engineering Director
– Mechanical Engineer
– Project Manager
– Software Engineer
Computer Game Development
– QA Game Testers
– Animator
– Instructional Designer
Food & Beverage Industry
– Distiller
– Chef
– Food Technologist
Insurance
– Risk Analyst
– Risk Manager
– Insurance Software Developer
Manufacturing
– Drafters
– Fabricators
– Assembly Technician
– Manufacturing Manager
Waste Management
– Waste Treatment Plant Design Engineer
– Sustainability Engineer
Apparel
– Textile Specialist
– Sample Maker
– Apparel Designer
It is crucial to evaluate the employee’s job responsibilities in addition to the job title. Some R&D contributors may not have job titles typically associated with R&D, but if they perform R&D activities, the activity is eligible to be part of a tax credit claim.
Many more job titles qualify for R&D. To find out if your employees have job titles and responsibilities eligible for R&D tax credits, get in touch with us.