The R&D Tax Credit for Small Businesses: The IRS Incentive You Might Be Missing
What Is the R&D Tax Credit?
The R&D Tax Credit for Small Businesses is one of the most overlooked opportunities in the tax code. If your company is developing software, improving internal systems, or creating new products or processes, you may qualify for this generous federal incentive—even if you’ve never filed for it before.
🧾 This credit is filed using IRS Form 6765, and BSH Accounting helps clients across many industries identify, calculate, and properly document it for maximum value.
Who Qualifies?
“Many of our clients don’t realize they qualify for the R&D Tax Credit for Small Businesses until we walk through their daily operations.”
You don’t need to be a tech startup or science lab. Businesses in these industries often qualify:
- Software & SaaS
- Architecture & engineering
- Manufacturing & prototyping
- Construction & specialty trades
- Food & beverage development
- Healthcare tech
- Financial services with custom systems
If your business is solving problems in a technical or systematic way, you likely qualify—even if the project wasn’t completed.
What Activities Count?
Examples of qualifying work include:
- Developing or improving products, formulas, or internal tools
- Automating processes or creating proprietary systems
- Running tests, prototypes, or simulations
- Designing or engineering custom solutions
- Eliminating technical uncertainty in operations
Photo Above Credit 1
According to an ADP study, Manufactuing is Roughly 70% of private sector R&D spending
How Much Is the R&D Tax Credit Worth for Small Businesses?
- The federal credit is generally 6% to 14% of qualifying expenses
- Startups can offset payroll taxes
- Other businesses can reduce income tax liability
💡 Bonus #1: You can amend past returns—up to three years back—to capture unclaimed credits.
💡 Bonus #2: Many states, including Texas, offer additional R&D tax credits. These can be stacked on top of the federal benefit.
How We Help
At BSH Accounting, we help businesses unlock the full value of the R&D Tax Credit for Small Businesses by:
- Identifying qualifying activities and expenses
- Preparing accurate IRS Form 6765 filings
- Amending prior-year returns if needed
- Guiding clients through state-level R&D credit programs
- Providing full documentation for audit protection
Ready to See If You Qualify?
Fill out the Client Application Form, and we will schedule a call with you.
- ADP credits photo ↩︎
