Research and Development Tax Credit

Research and Development Tax Credit

SPI Group recently attended a meat conference at Texas A&M and one of the speakers talked about R&D Tax Incentives for food companies that do R&D/Product development.

Many companies in the food manufacturing and processing industries are unaware that the government offers generous research & development incentive programs. Even those that are aware often fail to capture the full extent of R&D tax credits.

If your company has introduced product line extensions or modified product formulations then the tax credit applies. While the R&D Tax credit has been part of the tax code for decades, it only became permanent in December 2015 with the passage of the Protecting Americans from Tax Hikes (PATH) Act. The permanency of the credit will provide your company greater certainty and the ability to count on its savings in their annual planning.

Examples of Food Science innovations eligible for the R&D tax incentives include the following:

  • Develop recipe formulations for new food products and flavorings
  • Improve existing food product formulations to extend product shelf life
  • Develop new or improved agricultural or chemical materials that go into food


  • Improve existing food products to enhance sensory qualities
  • Improve existing food products to achieve nutritional requirements
  •  Improve existing formulations to achieve analytical requirements
  •  Develop new production processing techniques
  •  Develop new packaging designs
  •  Produce prototypes products for testing and validation
  •  Conducting sensory evaluations