This company’s core business is to manufacture solder products and customize solutions for various applications, including voiding and wetting and full metallography for failure analysis.
The company had historically claimed Research Tax Credits (RTCs) in Canada through another RTC provider, but had not considered the U.S. Research and Development (R&D) tax credit. Based on BGI’s expertise in federal and state R&D rules and regulations, a study was conducted, qualified activities were identified, and a credit in excess of $70K was generated.
BGI’s Value Add
Since engaging BGI, the company has realized a yearly increased RTC. For the period ending on 12/31/2014, BGI increased the company’s RTC benefit to over $130K and continued to streamline the annual exercise to be more aligned to the company’s business components and existing documentation standards – therefore, reducing the time commitment for an R&D study.
BGI has a diverse team of engineers, scientists, and CPAs that have worked collectively to add value to this engagement. BGI’s engineers have an in-depth understanding of the technical R&D conducted by the company, as well as manufacturing processes. They leverage this experience to guide the study. BGI began by working closely with Project/Subject Matter Experts (SMEs) to identify and assess qualified research activities/projects. BGI subsequently worked with the SMEs to understand the roles of the various R&D team members and their contributions to the projects. This detailed investigation allowed BGI to qualify employees that would otherwise not be qualified, based on their technical contributions.
BGI employed robust, proprietary tools to aid in capturing the qualified projects, the individual contributors and to develop the nexus between the Qualified Research Activities (QRAs) and corresponding Qualified Research Expenditures (QREs). These robust BGI tools have helped drive efficiency from year to year, ensured consistency in the study and maximized the RTCs. BGI also prepared an IRS audit worthy technical report to document the quantitative and qualitative analysis conducted for the study. The report carefully documents the QRAs and QREs, the RTC calculation methodology and supporting documentation. BGI’s diverse team also prepared technical reports of selected qualified projects, outlining the business objective, the technical nature of each project, the technical uncertainties and the process of experimentation employed with each project.
This client represents another type of industry that can qualify for and benefit from the RTC.