Industry Brief  ·  Construction Contractors

Means and methods are research.

The federal R&D tax credit pays for the problem solving your company already does on design-build and hard jobs. Most contractors never claim it.

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It costs nothing to find out. If there isn't enough credit to be worth claiming, you don't pay a thing.

New to youis enough. A method or assembly your company hasn't built before can count when you had to test your way to it.
4 years of creditin one study: this year, plus past years still open to amend, usually three.
Exam supportcomes with every study. If the IRS asks, we answer.

What counts on your jobs

Work you already bill for
  • Design-build and design-assistDeveloping the design, or working it out with the architect.
  • Means and methodsFiguring out how to build an odd structure, sequence, or site condition.
  • Constructability reviewCatching a detail that won't build and redesigning it with the team.
  • Temporary worksDesigning shoring, formwork, rigging, and crane plans for one job.
  • BIM coordinationFinding the clash and redesigning around it.
  • PrefabricationWorking out how to build an assembly off site and install it once.
  • Mockups and testingLoad tests, water tests, and mockups on a new assembly.
  • Value engineeringProposing a different system and proving it performs.

The four questions, for contractors

§41's four-part test
  1. Did you build with a method new to your company?It doesn't have to be new to the industry.
  2. Did it take real know-how?Loads, soils, water, and sequencing: your fixes rest on engineering and physics.
  3. Were you unsure at the start?How do we build this, on that site, to that spec?
  4. Did you try options to find out?Mockups, methods studies, and revised details are exactly that.

Unsure about any of these? That's what the call is for. The four-part test in plain English

Contractors ask

We build from someone else's drawings. Do we qualify?

Plan-and-spec work qualifies less often. But the questions the drawings leave open, from sequencing to temporary works, are yours to solve. Design-build and design-assist qualify more readily.

Our jobs are fixed price. Does that help or hurt?

It can. The credit stays with you when you only get paid if it works and you keep the right to reuse what you learned. The study reads every contract, fixed price or cost-plus.

Does the credit cover the whole job?

No. Only the part spent working out technical questions. Pouring the slab you already figured out stays out.

Do superintendents' hours count?

Yes, for the time they spend working out a technical question with no known answer, and for directly supervising or supporting that work.

Filing, how far back, exams, and costs: common questions.

For your CPA: where the credit goes on Form 1120, 1120-S, 1065, or 1040.

Other industry briefs

Where else it lands
HVAC and Mechanical Contractors

Your load calcs are research.

Design-build mechanical systems, sequences, and prefab can be qualified systems work.

Read the brief Electrical Contractors

Your one-lines are research.

Design-build distribution, controls, and prefab assemblies can be qualified systems work.

Read the brief Audio-Video Integration

Your installs are research.

Engineering a new control system into a real building can be qualified systems work, programming included.

Read the brief

Give us thirty minutes.

Bring whoever works out how your hard jobs get built. You'll leave knowing whether your projects qualify.

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