The life science industry is exactly what you picture when you envision the Research and Development (R&D) Tax Credit. Most companies in this industry are aware that the work they perform qualifies for the credit, however, we often find that companies believe they need to be a large corporation to take advantage.
Our team at McGuire Sponsel works closely with the client to learn about the different chemical processes, laboratory testing, and quality inspection that is involved in the day-to-day operations. Wages are generally the largest qualifying expense. These may include chemical engineers, chemists, and laboratory personnel. There are often supply expenses involved that include chemicals scrapped during the batch scale-up process and testing.
Success Story: Medical Device
A Pennsylvania start-up company dedicated to creating innovative pediatric heart devices and components engaged McGuire Sponsel to perform a study for a four-year period. After conducting interviews and analyzing project data and documentation, McGuire Sponsel calculated nearly $125k in federal credits, of which $36k was eligible to be utilized as a payroll tax credit. Additionally, McGuire Sponsel was able to assist the client in claiming $9.5k in Pennsylvania state credits.
Success Story: Food Processing
A chemical manufacturer that formulates and produces flavorings for the food and beverage industry engaged McGuire Sponsel to quantify and substantiate its 2018 R&D credit claim. McGuire Sponsel professionals conducted interviews with the company’s lead chemists and technical personnel and analyzed the company’s financial records. Through this analysis, McGuire Sponsel calculated over $1.2M in qualified research expenses for the tax year; generating a federal credit of $117k.