Industries | R&D


R&D Tax Credits for the Gaming Industry

With annual revenues projected to exceed $300 billion by 2025, the gaming industry has evolved into an arena of unrivaled realism, diverse user experiences, and a myriad of genres to cater to everyone, from casual mobile gamers to committed Twitch streamers.

The explosive growth over the past decade has dramatically reshaped the landscape for developers and studios. Small studios are now competing with industry giants for market share, resulting in an extensive variety of gaming choices and platforms.

Game development involves significant cost and risk, making additional cash flow essential, especially for small-to-midsize development studios. Given the technical and financial risks involved in game development, a lot of the work carried out qualifies for the credit.

In most gaming companies, the largest expenditure is the cost of talent, both internal and external. These are considered as QREs (Qualified Research Expenses), and if your company is already making these investments, you’re entitled to reap the benefits of the R&D tax credit. This provides crucial support to developers, helping them to continue pushing the boundaries of gaming innovation.

Qualified Research Activities for Game Development

Highlights in the Case Study

Over a 4 year period, this company was able to generate roughly $2MM in total Federal credits and $800K in state credits. 

A game studio based in the US began an extensive research and development effort to make the leap into Virtual Reality (VR) over the course of several years.

Download Our Gaming Case Study

Take Advantage of the R&D Tax Credit with Source Advisors

The R&D tax credit can help a wide variety of businesses offset and reduce their income tax liability, in addition to providing many other benefits. Our team of experienced CPAs, attorneys, engineers, and technology experts helps companies save money and create cash flow with R&D tax credits that can then help drive overall growth.