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Writer's pictureLindsay Polyak

Machine Shops and the R&D Credit

Tax Credit Collective overviews common activities that can qualify machine shops for tax credits- especially the Research & Development tax credit.



Does Your Machine Shop Engage In These Activities?

There are many activities that can qualify various machine shops to capture the Research and Development (R&D) tax credit. If your shop does any of these activities, you could be eligible for the Research and Development (R&D) Tax Credit.

  • Developing or improving a product or concept for a client

  • Materials purchased to use in product development

  • Engineering, supervisory or supporting time on projects

  • Using CAD software to design products

  • Measuring, milling, and lathing products

  • Creating a metal or 3-D printed model

  • Modeling or testing new concepts

  • Using FEM software to virtually test how products react to real-world forces such as heat, vibration, or fluid flow

  • Implementing new manufacturing processes or improvements

  • Implementing testing or quality control

  • Incorporating or developing new technology to catch up to a competitor

  • Attempting to develop or improve a process or product and eventually abandoning the attempt

  • ... and many more activities. This is just a short list!


Tax Credits Can Be Complicated

We know Tax Credits can be tricky to understand, calculate and substantiate for machine shops. We're here to help you determine if you are eligible to capture the R&D tax credit. You can reach us at 833-3INCENT.


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