Custom structural, MEP, and constructability engineering frequently require resolving design uncertainty for unique site, load, or code conditions — qualified when the firm bears the risk and retains rights.
The credit is calculated on qualified research expenses (QREs) — primarily wages for engineers and technical staff who spend time on qualifying activities, plus supplies, cloud/compute, and 65% of qualified contract research.
The table below lists the business components that most often qualify, a common example, and the technical uncertainty that makes each one defensible.
| Business component | Example | Technical uncertainty |
|---|---|---|
| Custom structural engineering | Novel structural system or seismic design | Will the design meet load and code under site constraints? |
| MEP systems design | Complex HVAC, electrical, or plumbing system | How to optimize MEP for performance and code compliance? |
| BIM & digital modeling | Clash detection, parametric coordination | How to model and coordinate complex systems digitally? |
| Prefabrication & modular | Modular or prefabricated assemblies | Will prefab methods meet tolerance and structural needs? |
| Energy & sustainability design | Net-zero or passive-system design | Will the design meet energy-performance targets? |
| New materials & methods | Mass timber, novel concrete mix | Will the material or method perform structurally? |
| Geotechnical & site engineering | Foundation design in difficult soils | Which approach resolves the geotechnical uncertainty? |
| Construction process / sequencing | New construction method or sequence | Which method is feasible, safe, and efficient? |
Wages for time spent on qualified research may count toward your credit. Percentages depend on facts and must be documented.
Funded-research risk is high in AEC. Work fully paid for by a client who bears the risk, with no retained rights, is excluded. Confirm contract terms before claiming.
Illustrative example using sample figures. Your actual credit depends on your facts; see Form 6765 and consult a tax professional.
The IRS requires qualifying research to satisfy four tests. Here's how they typically map for this industry:
The activity aims at improving a product, process, software, or technique used in the business — not just a business outcome.
The work relies on principles of engineering, computer science, biology, chemistry, or another hard science to resolve uncertainty.
There was genuine uncertainty at the outset about whether — or how — the component could be built or improved.
The team evaluated alternatives: A/B tests, prototypes, benchmarks, simulations, or iterative design-build-test cycles.
Most companies underestimate what they can claim. Our study covers every qualifying role, every component, and every year still open for amendment.
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