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Over 65 industries can qualify for the R&D Tax Credit by innovating or improving products, processes, or technologies.
R&D Tax Credit Basics
Established in 1981, the Research & Development Tax Credit is a federal incentive that allows companies to reduce income tax liability in the current tax year, and receive a cash refund for taxes paid in the last three years.
Many states have implemented their own version of the R&D Tax Credit, allowing qualifying businesses to claim both federal and state credits. In 2015, the Protecting Americans from Tax Hikes (PATH) Act made the federal R&D Tax Credit permanent and expanded its accessibility for qualified small businesses. With these changes, qualifying small businesses may claim the Payroll Tax Credit to offset some of their payroll tax liability.
The majority of businesses are unaware that their daily operations could qualify to a dollar-for-dollar Tax Credit, irrespective of industry or company size. An activity that meets the 4-part test is a qualifying research activity and can potentially qualify for claiming R&D Tax Credit.
Eligibility
Why Leyton
Tax & Industry Technical Experts
Years of Experience
Countries
Industries Served
Innovation Tax Incentives Claims
How it helps
The R&D Tax Credit is generally calculated using four categories of qualified research expenses (QREs): employee wages, supplies and raw materials, cloud computing costs, and contract research expenses
Our Process
A streamlined six-step process designed to maximize your R&D Tax Credit
Meet with a member of our team to receive an overview of the R&D Tax Credit and review your eligibility. Our team will collect the financial documentation needed from you.
Our team will use this information & data to estimate what incentives you are eligible for and establish an optimal claim timeline. If no credit is identified, there will be no cost for you.
Our technical consultants will determine the list of qualified R&D projects according the 4-part test while our tax consultants will work with you to ensure that the Qualified Research Expenditures (QREs) are accurate.
Leyton’s team of Tax and Technical experts will work together to complete the calculations and provide your deliverables, including a detailed technical report and supporting documentation.
After filing the proper documentation with the IRS, the tax credit will reduce your income tax liability in the current tax year and refund for the previous 3 years. Any remaining credit can be carried forward up to 20 years.
Review your R&D Study Report with our Tax and Technical experts for the next year to increase efficiencies for future claims.
Trusted Innovation Incentives Experts
Supporting clients through every step of their R&D journey.
Jerome Negro
Senior Financial Controller
@GoGo squeeZ
“During all the projects there was a lot of flexibility and agility where Leyton was able to adapt. The first year was a good experience and then the next years were even easier and now it’s just like rolling this forward with all new data and the process is very streamlined and goes very smoothly.”
Heather Kelley
Co-Founder
@Keon Research
“I really liked how Leyton brought in a wide breadth of expertise, such as bringing in a scientist to understand and assess our projects. The process did not take as long as we thought it might, in terms of overall hours, and Leyton’s experience was very helpful in guiding us through the process.”
Dave Landry
Co-founder
@Datawheel
“I see the value in that. It was an interesting exercise to look back at our projects and uncover qualifying R&D. We filed amended returns, recouped the money, and put it back into the company!”
Dave Landry
CFO
@United Dwelling
“The payroll tax credit has been a nice offset to preserve cash. The collaboration with our teams was efficient, focused, and comprehensive. The relationship was great- response times, knowledge, and incisive questions/discovery were all very helpful.”
Jonathan Jasinski
COO
@Mircroplant Nurseries
“Our experience with Leyton was seamless and easy in a process that could have been complicated and burdensome. We would highly recommend working with Leyton. We had avoided taking advantage of the R&D Tax Credit in the past because we didn’t have a way of recording/reporting the information required. Leyton made that possible.”
Elizabeth Hopkins
President
@Sapidyne Instruments Inc & GmbH
“We had a great experience with Leyton. They communicated effectively and were able to get us tax documents quickly. The amount of tax credit we received was more than I had expected.”
Rusty Peterson
Founder
@Align Agro
“Everything was easy-peasy! Leyton teams went above and beyond. People got back to me quickly, even with a 3 hour difference. I’ve told a couple of people about this credit already and it doesn’t cost you anything to look at it. You literally have nothing to lose!”
Get in Touch
Our Innovation team is there to ensure your projects are seen from all perspectives and to answer all your questions and help you make the most out of your Innovation efforts
FAQs
Can’t find the answer you’re after? Please contact our team
Our goal is to make the process as efficient as possible. Once we receive all required financial and technical documentation, an R&D Tax Credit study is typically completed within 1–2 months, depending on the size and complexity of your business.
Completing the study is separate from receiving the tax benefit. If the credit is claimed on a current-year tax return, the benefit may be realized when the return is filed. If you’re claiming the credit through an amended return, the IRS processing time for a refund can vary and may take 12 months or longer.
No, claiming the R&D Tax Credit does not increase your risk of audit; the chance of audit is increased slightly (1 – 3% Federal average) upon amending a return – regardless of the reason. This slight risk is inherent in amending for a refund due to claiming the credit in a past year vs. On a timely-filed return.
Yes, any cost claimed towards the R&D Credit must have been derived in the U.S. That means for employees and contractors, they must have been located in the U.S. or U.S. territories in order for those payments to count as eligible expenses towards the credit.
Yes, sub-contracted expenses can be included at 65% of their cost incurred by the company. (I.e. a contractor paid $100k would have $65k in eligible expenses to potentially be qualified towards the credit).