Companies in the Consumer Products industry undertake a variety of research and development efforts in order to meet consumer demands in regards to new products, product quality, and product costs. Companies are always looking to develop new features, improve product quality, and also ensure efficient production. These activities can take up significant resources and capital.
The R&D Tax Credit can allow companies in the Consumer Products industry to increase cash flow, invest in expansion projects, and continue to grow their business. Examples of activities that could qualify for the R&D Credit include:
- Developing product improvements in order to increase ease of use.
- Developing fixtures and tooling for prototyping.
- Developing new or improved manufacturing processes to increase product quality or reduce cost.
- Developing material or design improvements and testing for safety and functionality.
For example, Company ABC develops and distributes a variety of cosmetics. The Company takes on a project to develop a new lotion formulation with a unique dispensing pump. Company ABC evaluates alternative formulations to meet specific safety and performance standards of the product. Furthermore, the Company evaluates pump designs and manufacturing prototypes to identify the optimal pump design. In this case, Company ABC can capture costs involved with development of the lotion formulation and pump.
Working directly with clients and their CPAs, TRCG has delivered R&D services to a wide spectrum of Consumer Products companies. Through industry expertise, TRCG can quickly understand your company processes, identify potential qualifying projects, and help you capture valuable tax credits.