When you think of R&D tax credits, breweries may not be the first thing that comes to mind. But dive into this case study to learn how Source Advisors uncovered a goldmine of tax benefits for a flourishing craft brewery engaged in unique R&D activities.
Founded as a specialty-packaging manufacturer, this $30 million company is the go-to for top food brands. With a comprehensive suite of design, manufacturing, and co-packaging services, the company has become an essential part of the food industry supply chain.
Creating a specialized container for gumballs that catered to children’s needs posed unique challenges. These included not just practical considerations, but also the need to make the design fun and engaging. R&D was required to balance functionality with design, safety, and manufacturing efficiency.
In the case of this specialty-packaging manufacturer, R&D activities revolved around the creation of a unique gumball container that was both functional and had play value for children. The efforts included material selection, design testing, and safety evaluations. Each phase involved multiple iterations and experiments to ensure the container was easy to manufacture, safe for children, and met all storage and shipping requirements.
Before diving into the project, Source Advisors conducted a preliminary feasibility analysis to set potential credit expectations and explain the process. This was crucial for the packaging company in choosing us over other providers.
We examined the specific challenges related to the design of the gumball container. Our evaluation focused on the complexity of the design, material selection, and testing for safety and functionality.
Our team reviewed financial records, including but not limited to, costs related to labor, supplies, ingredients, and overheads. We then calculated the potential tax credits that the manufacturer could claim based on these expenditures, ensuring they wouldn't miss out on any benefits.
The identified R&D activities were cross-verified against federal and state tax laws to ensure they met the necessary legal criteria for claiming R&D tax credits. This not only included the qualifications of the activities themselves but also reviewed the supporting documentation and justifications to ensure they were compliant and audit-proof.
Don’t miss out on the valuable tax credits that could boost your businesses growth.
Contact Source Advisors today to explore how we can unlock tax advantages for your food or beverage company.