R&D Tax Credit for Medical Equipment & Devices

R&D Tax Credits for Medical Devices & Equipment

What is the R&D Tax Credit for Medical Devices & Equipment?

The R&D tax credit for Medical Devices & Equipment is a unique tax incentive that benefits businesses in this industry. It supports companies that engage in activities such as the development of innovative medical devices, the improvement of healthcare equipment, testing and implementing novel medical technologies, ensuring compliance with regulatory standards, and enhancing patient care solutions. The R&D tax credit reduces your federal tax liability dollar-for-dollar and allows businesses an immediate source of liquid assets to get projects off to an immediate start. Businesses are also able to claim the R&D tax credits retroactively for up to 3 or 4 years for work that has already been completed.

Many medical device & equipment businesses may be eligible for the R&D tax credits and not even realize it. Does your business qualify for the R&D tax credit? The IRS has 4 guidelines in place to help businesses understand if they may qualify:

1. Does your business develop or improve upon products, businesses, or services?

2. Does your business systematically evaluate one or more alternatives during the process of experimentation?

3. Does your business attempt to solve a technical uncertainty?

4. Does your business fundamentally rely upon established principles of science?

If you answered yes to these 4 questions, your medical device & equipment business may be eligible to claim these beneficial R&D tax credits. Proveres is here to help you figure out the details.

What can the R&D Tax Credits do for Medical Devices & Equipment businesses?

Reduce your payroll taxes
Use as non-dilutive funding
Carry your credit forward

How It Works

Proveres will work closely with your business to gain maximum tax credits each year by following these 5 steps:

Identify & Discover

Proveres provides a full analysis of your business and operations, and will help identify which projects and work your business does that can be claimed towards the R&D tax credit.

Quantify

Proveres reviews expense-related data from your business and identifies what will qualify for the R&D tax credit.

Qualify

Proveres gathers relevant information and documentation into the qualifications for each R&D tax credit claim.

Validate & Support

When the credits to be claimed have been calculated and validated, Proveres assists your business to facilitate a smooth tax filing process.

Annual Reviews to Maximize Credits

In addition to discovering existing R&D tax credits your Medical Devices & Equipment business qualifies for, Proveres also helps your business identify and implement procedural changes to unlock future R&D tax credits.

Several qualifying business activities for the R&D tax credit encompass, but are not confined to, research, development, design, experimentation, or testing in the following areas:

Product Development: Developing new medical devices or improving existing ones to enhance patient care, diagnosis, or treatment.
Prototyping and Testing: Creating prototypes of medical equipment and conducting tests to ensure they meet regulatory and performance standards.
Design and Engineering: Engaging in the design and engineering of medical devices and equipment, including hardware and software components.
Regulatory Compliance: Activities related to ensuring compliance with FDA and other regulatory requirements for medical devices.
Clinical Trials and Studies: Conducting research and clinical trials to assess the safety and effectiveness of new medical devices.
Development of Software: Designing and developing software for medical devices, such as diagnostic tools, monitoring systems, or patient data management.
Process Improvement: Identifying and implementing more efficient manufacturing processes for medical devices and equipment.
Quality Control and Assurance: Activities aimed at maintaining high-quality standards and ensuring product safety.
Biomedical Research: Research into new materials, techniques, or technologies with applications in the medical devices industry.
Customization and Adaptation: Developing customized medical devices or equipment tailored to specific patient needs or healthcare settings.
Usability and Human Factors Studies: Evaluating and improving the usability and human factors of medical devices for optimal user experience.
Innovations in Materials: Research and development activities focusing on the use of innovative materials for medical device construction.
Efficiency Enhancements: Identifying and implementing methods to improve the efficiency and reliability of medical equipment.

Additionally, if you have employees or 3rd-party contractors with the following job titles, you may qualify for R&D tax credits:

Biomedical Engineers
Mechanical Engineers
Software Engineers
Electrical Engineers
Data Analysts
Software Developers
Research Scientists
Toxicology Scientists
Biocompatibility Scientists
Quality Assurance Specialists
Cybersecurity Specialists
Regulatory Affairs Specialists
Product Designers

It's essential to work with tax professionals or specialists experienced in R&D tax credits, and Proveres is the top choice to help you determine which specific activities within your business qualify and ensure proper documentation to support your claims. Additionally, tax laws and regulations may change, so it's crucial to stay updated on the latest guidelines and requirements for claiming these credits. To learn more about the R&D Tax Credit for Medical Devices & Equipment and whether your business qualifies, please contact us. Proveres is the definitive advisory firm to navigate your R&D tax credit journey.