Research Tax Credit

All about the R&D tax credit, research, court cases, and more.

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R&D Tax Credit Court Decisions


Trade or Business Requirement

  • Software 16 v. Comm’r, 63 T.C.M. 2876 (1992).
  • Snow v. Comm’r, 416 U.S. 500 (1974).
  • Tyson Foods v. Comm’r, T.C. Memo 2007-188.
  • Green v. Comm’r, 83 T.C. 667 (1984).
  • McManus III v. Comm’r, 54 T.C. Memo 1987-457.
  • Zink v. United States, 929 F.2d 1015 (5th Cir. 1991).
  • Stauber v. Comm’r, T.C. Memo 1992-128.
  • Harris v. Comm’r, 16 F.3d 75 (5th Cir. 1994), aff’g 99 T.C. 121 (1992).
  • Kantor v. Comm’r, 998 F.2d 1514 (9th Cir. 1993).
  • LDL Research & Development II, LTD v. Comm’r, 124 F.3d 1338 (10th Cir. 1997).

Partnership or Partner Level

  • Spellman v. Comm’r, 845 F.2d 148 (7th Cir. 1988), aff’g, T.C. Memo 1986-403.
  • Safstrom v. Comm’r, 42 F.3d 1401 (9th Cir. 1994), aff’g, T.C. Memo 1992-587.
  • Ben-Avi v. Comm’r, T.C. Memo 1988-74.

Business Component

  • Trinity Industries, Inc. v. United States, 691 F. Supp. 2d 688 (N.D. Tex. 2010).

Qualified Research

  • Four Part Test
    • Heritage Organization, LLC v. Comm’r, T.C. Memo. 2011-246
    • Suder v. Comm’r, T.C. Memo. 2014-201
    • Mayrath v. Comm’r, 357 F.2d 209 (5th Cir. 1966), aff’g, 41 T.C. 582 (1964).
    • Agro Science Co. v. Comm’r, T.C. Memo 1989-687.
    • Best Universal Lock Co., Inc. v. Comm’r, 45 T.C. 1.
    • Coors Porcelain Co. v. Comm’r, 52 T.C. 682.
    • Reiner v. Comm’r, T.C. Memo 1965-197.
    • Kollsman Inst. Corp v. Comm’r, 870 F.2d 89 (2d Cir. 1989), aff’g, T.C. Memo 1986-66.
    • Koons v. Comm’r, 35 T.C. 1092 (1974).
    • TSR, Inc. v. Comm’r, 96 T.C. 903 (1991).
    • Yellow Freight Systems, Inc. v. United States, 24 Cl. Ct. 804 (1991).
  • Limitation on Literary, Historical, or Similar Projects
    • Crouch v. Comm’r, T.C. Memo 1990-309.
    • Quinn v. Commissioner, T.C. Memo 1974-64.
  • Limitation on Internal Use Software
    • FedEx Corporation v. United States, Dkt. No. 08-2423 (W. D. Tenn. 2009).
    • Norwest Corp. v. Comm’r, 110 T.C. 454 (1998).
    • United Stationers, Inc. v. United States, 163 F.3d 440 (7th Cir.1998), cert denied, 529 U.S. 1023, aff’g 982 F. Supp. 1279 (N.D. Ill. 1997).
    • Wicor, Inc. v. United States, 263 F.3d 659 (7th Cir. 2001), aff’g 116 F.Supp. 2d 1028 (ED Wis. 2000).
    • Tax and Accounting Software Corp. v. United States, 301 F.3d 1254 (10th Cir. 2002), 111 F.Supp. 2d 1153 (DC Okla. 2000).
  • Limitation on Funded Research
    • Dynetics, Inc. & Subs v. United States, No. 12-576T (Ct. Cl. 2015).
    • Geosyntec Consultants, Inc. v. United States, 776 F.3d 1330 (11th Cir. 2015).
    • Lockheed Martin Corp. v. United States, 210 F.3d 1366 (Fed. Cir. 2000), 42 Fed. Cl. 485 (1998), 39 Fed. Cl. 197 (1997).
    • Fairchild Industries v. United States, 71 F.3d 868 (Fed. Cir. 1995), 30 Fed. Cl. 839 (1994).

    • Qualified Research Expenses

    • Wages
      • Hakim v. Comm’r, 512 F.2d 1379 (6th Cir. 1975), aff’g, T.C. Memo 1974-46.
      • Utah Jojoba I Research v. Comm’r, T.C. Memo 1998-6.
      • Cactus Wren Jojoba, Ltd. v. Comm’r, T.C. Memo 1997-504.
      • Apple Computer, Inc. v. Comm’r, 98 T.C. 232 (1992), acq., 1992-2 C.B. 1.
      • Sun Microsystems, Inc. v. Comm’r, T.C. Memo 1995-69, acq., 1997-2 C.B. 1.
    • Supplies
      • TG Missouri Corp. v. Comm’r, 133 T.C. 13.
      • Union Carbide Corp. and Subs. v. Comm’r, T.C. Memo 2009-50.
      • Ekman v. Comm’r, 184 F.3d 522 (6th Cir. 1999), T.C. Memo 1997-318.
      • Lockheed Martin Corp. v. United States, 210 F3d 1366 (Fed. Cir. 2000), 42 Fed. Cl. 485 (1998), 39 Fed. Cl. 197 (1997).
    • Reasonable Expenses
      • Driggs v. Comm’r, 706 F.Supp. 20 (N.D. Tex. 1989).
      • Suder v. Comm’r, T.C. Memo. 2014-201
    • Limitation on Depreciable Property
      • Magee v. Comm’r, T.C. Memo 1973-271.

    Gross Receipts

    • Procter & Gamble Co. v. United States, 733 F.Supp.2d 857 (S. D. Ohio 2010).
    • Deere & Co. v. Comm’r, 133 T.C. 11.

    Base Period

    • Research, Inc. v. United States, 76 A.F.T.R.2d 95-5688, 95-2 USTC P 50,407 (D. Minn. 1995).
    • Fudim v. Comm’r, T.C. Memo 1994-235.

    Substantiation

    • CRA Holdings U.S., Inc. v. United States, No. 15-CV-239W(F) (W.D.N.Y. 2017).
    • Shami v. Comm’r, T.C. Memo. 2012-78.
    • Suder v. Comm’r, T.C. Memo. 2014-201.
    • Depree v. Comm’r, T.C. Memo. 2015-40.
    • United States v. Goertz, No. A-09-CA-179 LY (W.D. Tex. 2010).
    • Eustace v. Comm’r, 312 F.3d 905 (7th Cir. 2002), aff’g, T.C. Memo 2001-66.
    • Fudim v. Comm’r, T.C. Memo 1994-235.
    • United States v. McFerrin, 570 F.3d 672 (5th Cir. 2009), rev’g, 492 F.Supp.2d 695 (S.D. Tex. 2007).
    • Allen v. Comm’r, T.C. Memo 1988-166.
    • Grindle v. Comm’r, T.C. Memo 1993-297.
    • Johnson v. Comm’r, T.C. Memo 1993-564, aff’d in unpublished opinion, 50 F.3d 2 (2d Cir. 1995).
    • Coors Porcelain Co. v. Comm’r, 52 T.C. 682 (1969).
    • Koons v. Comm’r, 35 T.C. 1092 (1961).

    Information Controls

    • Bayer Corp. & Subs. v. United States, Civil Action Nos. 08-693, 09-351 (W.D. PA 2010).

    Refund Suit

    • United States v. Quebe, Case No. 3:15-cv-294 (S.D. Ohio 2017)
    • United States v. Beltecno Inc. & Subs., 104 AFTR 2d 2009-5929 (W.D. WA 2009)

    Last Updated: 2/7/2017

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