If your company invests in improving efficiency, functionality, reliability, or quality, the research and development credit could deliver meaningful tax savings. This federal incentive encourages businesses to pursue innovation by rewarding qualified research activities. The R&D credit is not limited to scientists in labs; it applies to real-world problem-solving across industries. Activities involving design iteration, prototyping, testing, or technical modeling may qualify. Eligible expenses often include employee wages, supplies consumed in testing, and certain contracted research costs.