R&D Tax Credit:
Turn Innovation Into Cash Flow
If your company develops new products, improves existing ones, or experiments with design and production methods — you could qualify for a major tax credit. And we know how to make the most of it.
what is the R&D tax credit?
The Research & Development (R&D) Tax Credit rewards businesses that invest in innovation.
It applies to activities such as:
-
Developing or improving a product, process, or prototype
-
Experimenting with new materials or production methods
-
Engineering or industrial design work to improve performance or quality
-
Testing and validating new product designs
These activities don’t need to be “high-tech.” If you’re solving problems, improving design, or refining production, chances are you qualify.
michigan's new R&D credit (effective 2025)
Michigan has introduced a state-level R&D credit starting January 1, 2025 — a huge win for local manufacturers and product developers.
Up to 15% of qualified
research expenses can be claimed as a tax credit
$100 million in total credits
available statewide, with $25 million reserved for small businesses
Applies to companies
conducting research and design work within Michigan
Covers qualified design,
engineering, and prototyping activities
This means if you’re developing or improving products here in Michigan, you could receive thousands back in credits — and working with a qualified R&D partner like 2B Studio strengthens your claim.
not in michigan? no problem!
The federal R&D credit (available nationwide)
Even if you’re outside Michigan, the federal R&D credit can significantly reduce your tax burden.
Covers up to 10%+
of qualified research expenses
Available to any U.S.
business performing qualified R&D
Can apply retroactively
for prior tax years
Commonly used by
manufacturers, product designers, and tech companies
At the federal level, many of the same activities qualify, including concept development, prototyping, and product testing.
Why 2B studio?
We’ve spent over three decades turning ideas into manufacturable realities.
Our work often qualifies as R&D under both federal and Michigan credit definitions — meaning clients benefit twice:
-
You get production-ready design and development from an experienced team.
-
You can claim a tax credit on a portion of those project costs.
We collaborate directly with your CPA or tax advisor to document eligible expenses and ensure everything aligns with the credit’s requirements.
Example projects
that may qualify
• Product design & prototyping
• Engineering refinements and production improvements
• Material testing and performance optimization
• Ergonomic redesigns or functional improvements
• 3D modeling, rapid prototyping, and CAD development
If you’re innovating, you’re likely qualifying.
