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R&D Tax Credits for Software Development

Software Programmer

What is the R&D Tax Credit for Software Development?

The R&D tax credit for Software Development is a unique tax incentive that benefits businesses that develop or improve upon products, processes, or services.  The R&D tax credit reduces your federal tax liability dollar-for-dollar and allows businesses an immediate source of liquid assets to get projects off to an immediate start.  Businesses are also able to claim the R&D tax credits retroactively for up to 3 or 4 years for work that has already been completed.


Many software development businesses may be eligible for the R&D tax credits and not even realize it.  Does your software development business qualify for the R&D tax credit?  The IRS has 4 guidelines in place to help businesses understand if they may qualify:

Young Scientist

1.  Does your business develop or improve upon products, businesses, or services?

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2.  Does your business systematically evaluate one or more alternatives during the process of experimentation?

Fixing a Computer

3.  Does your business attempt to solve a technical uncertainty?


4.  Does your business fundamentally rely upon established principles of science?

If you answered yes to these 4 questions, your software development business may be eligible to claim these beneficial R&D tax credits.  Proveres is here to help you figure out the details.

What can the R&D Tax Credits do for Software Development businesses?


  • Reduce your payroll taxes

  • Use as non-dilutive funding

  • Carry your credit forward



How It Works


Proveres will work closely with your business to gain maximum tax credits each year by following these 5 steps:

Identify & Discover

Proveres provides a full analysis of your business and operations, and will help identify which projects and work your business does that can be claimed towards the R&D tax credit.


Proveres reviews expense-related data from your business and identifies what will qualify for the R&D tax credit.


Proveres gathers relevant information and documentation into the qualifications for each R&D tax credit claim.

Validate & Support

When the credits to be claimed have been calculated and validated, Proveres assists your business to facilitate a smooth tax filing process.

Annual Reviews to Maximize Credits

In addition to discovering existing R&D tax credits your Software Development business qualifies for, Proveres also helps your business identify and implement procedural changes to unlock future R&D tax credits.

Some examples include, but are not limited to Research, Development, Design, Experimentation, or Testing of any of the following categories:

  • Cybersecurity

  • Cryptocurrency & Blockchain

  • Electronics & Robotics

  • Telecommunications

  • SaaS

  • Mobile application development

  • Video Game Development

  • AR/VR Development

  • Artificial Intelligence

  • FinTech (Financial Technology)

  • Developing source code

  • Integrating and customizing third-party applications

  • UI/UX


Additionally, if you have employees or 3rd-party contractors with the following job titles, you may qualify for R&D tax credits:

  • Software Developer / Software Engineer

  • Back-end / Full-Stack Developers

  • UI/UX Engineers

  • C-Suite

  • Data Scientist

  • Product Manager

  • QA/QC Employees

  • Research Analyst


To learn more about the R&D Tax Credit for Software Development, and whether your business qualifies, please contact us

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