By Stacey Roberts and Jamie Overberg 

Stacey Roberts, director of state and local tax, got an opportunity to ask Jamie Overberg some questions about the criteria for claiming research and development (R&D) credits. As a partner in TaxOps Minimization, Jamie Overberg focuses on research tax credits, primarily, and to a lesser degree, issues related to §382 and §263A. She completed research and development (R&D) credit studies for well over a decade at EY but made the move to TaxOps to be able to work hand-in-hand with businesses. Jamie shares some surprising considerations and questions to ask in determining whether a company is eligible. Read the summary or watch the interview.

There are several considerations and questions to ask in determining whether to pursue R&D credits. First, consider how many engineers and software developers the business has on its R&D team. In general, it takes a minimum of six engineers or software developers at a company to generate sufficient expenses – wages, salaries, outside contract and leased computer costs associated with R&D to generate a sufficient ROI on R&D credits.

Next, consider whether the R&D is improving a product or process. This is a necessary criteria for eligibility. And finally, consider whether your team could benefit from the cash flow and investment proceeds of federal and state R&D credits. Billions of dollars are distributed to both small and large companies, so filing a claim is worth a try.

What’s the payoff

There are several ways to increase and improve your chances of getting a favorable decision on credit claims. First, keep design documents that demonstrate your product’s research. Second, be prepared to prove nexus between each associate development activities and the project.

A $1 million spend on research could gain a business a federal credit of $100,000. States, however, present a challenge.  There are roughly 38 states that currently offer a credit but all with slightly different criteria and requirements. Capitalizing on state credits may require nuanced differences in each research filing by state.

Federally, a business is permitted to change computation methods. States, however, do not always offer all federal methods .  TaxOps Minimization’s R&D team completes the credit under methods available to select which can offer the most credit.


Many businesses mistakenly think only larger corporations benefit from R&D credits. This is incorrect. Although large companies may receive a larger credit, small companies are eligible and can benefit more with federal and state credits combined.

In 2018, the IRS received $23 billion dollars of R&D credit claims. It’s a large amount provided only to companies that apply. So, reach out to Jamie Overberg at for a quick cost/benefit analysis of R&D credits for your business or to SALTovation’s Stacey Roberts at to join the conversation. 

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