R&D Tax Credits
SaaS & Software
Engineering wages are the largest single bucket of qualifying expense for most software companies. Most leave them on the table.
$0
Initial assessment. No fee to find out.
4-8 wks
Typical study, start to finish.
9 yrs
Building defensible credit claims since 2017.
Why this work qualifies
For a software company, the R&D credit is mostly a payroll question. Engineering salaries are the largest expense on the books and the largest pool of potentially qualifying cost, because building product under technical uncertainty is what the team does all day. Architecture decisions, features that required evaluating multiple approaches, performance work against hard targets, AI features that needed real evaluation and tuning: all of it maps to the credit's four-part test.
The gap between what qualifies and what gets claimed is usually widest here. Conservative preparers claim little or nothing; aggressive shops sweep in the whole payroll and invite scrutiny. The defensible middle is a project-by-project study that ties wages to specific qualifying work using the records engineering already produces: repos, tickets, and design docs. Pre-profit companies should look too, since qualified small businesses can often apply the credit against payroll taxes rather than income tax.
Common qualifying activities
- ✓Designing system or platform architecture
- ✓Building new features that require evaluating multiple approaches
- ✓Optimizing performance, scale, or reliability
- ✓Integrating third-party APIs with non-trivial behavior
- ✓Building ML and AI features, including evaluation and tuning
- ✓Security and compliance engineering
What typically does not qualify
Routine bug fixes, UI styling with no technical uncertainty, configuring off-the-shelf tools, content work, sales engineering, and customer support generally do not qualify. Separating these out is what makes the rest of the claim credible.
$1.1M+
in federal credits identified for Graphite Connect, a B2B SaaS company.
Read the Graphite Connect case study →Individual results vary based on each company's activities, documentation, and facts.
Common questions
SaaS & Software, answered.
We're not profitable. Does the credit do anything for us?
It may. Qualified small businesses can often elect to apply the credit against payroll taxes rather than income tax, which puts real money back into a pre-profit company. Eligibility rules apply, so this is worth checking early.
Can we claim for prior years?
Often, yes. Amended returns can generally reach open tax years, typically the prior three. A first-time study frequently covers multiple years at once.
Does AI and ML work qualify?
Building and tuning models, designing evaluation frameworks, and integrating AI into product under real technical uncertainty are strong fact patterns. Prompt tweaks and vendor API calls with no engineering around them are weaker. The study draws that line project by project.
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