Does your manufacturing business improve a process or product for the automotive industry? Do you work to make an automotive product cleaner or more efficient? Or, perhaps you provide technical solutions that make production work more efficiently. If you are conducting any of these activities, are you taking advantage of the research and development (R&D) tax credit?
The R&D tax credit has always rewarded innovation, but 2026 marks a turning point thanks to the sweeping changes introduced by the One Big Beautiful Bill Act (OBBBA) in 2025. The OBBBA strengthened and modernized the R&D Tax Credit by expanding eligibility, restoring value to domestic research, and improving cash flow opportunities for innovative businesses. These OBBBA benefits have transformed the credit from a niche tax incentive into a core financial strategy for growth minded companies.
Efforts made to design and develop new products and manufacturing processes for improved performance and efficiency in the tool and die industry can qualify for research and development tax credits.
When you think about it, packaging is essential for any product being sold. From storage to transport to the end user, package designers seek ways to advance the quality, functionality and safety of their products—all within compliance of regulatory guidelines. Many package designers would be surprised to discover that many of the activities they already are conducting qualify for valuable tax credits.
Does your dairy company undertake activity intended to develop a new or improved product or process for yourself or your customer?
Apparel manufacturing companies are also eligible for the research and development tax credit for any activities relating to creating new and or improving existing manufacturing processes.
At first glance, it may seem unlikely that the poultry industry would have much in common with federal and state research and development (R&D) tax credits. After all, for years, R&D tax credits have been associated with large manufacturing, high-tech and medical companies. However, businesses engaged in the poultry industry are ripe with qualifying opportunities for valuable tax credits associated with the activities they conduct for improved products and/or processes.
Consumer demands for fresher products made without artificial colors/flavors, preservatives, hydrogenated fats, or genetically modified ingredients (GMOs) have had a significant impact on the food science industry in recent years. These demands have made research and development a key factor in the productivity and growth of the food industry.
If your company operates in the water treatment industry there is a good chance that you would benefit from the R&D credit.
On July 4, 2025, President Trump signed the “One Big Beautiful Bill Act” (H.R. 1) into law. This sweeping legislation locks in lower tax rates, and restores some valuable incentives for business owners, including 100% Bonus Depreciation, immediate R&D expensing, and the Section 199A Qualified Business Income Deduction.
For business owners, this isn’t just good news–it’s a call to action. The new rules create opportunities to save big before the end of 2025, but only if your tax planning strategy is in place in time.
