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Success Stories

Aerospace and defense contractor claims their first R&D credit

Being skilled in R&D and tax controversy, we knew how to properly document and defend the credit before the IRS.

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    "From 0% to 50% to 85% acceptance - they're the only firm we've found (and trust me, we've looked!) that will dig in and go the distance for their client."

    The Background

    A global aerospace and defense contractor who had never claimed the R&D credit hired TCC to conduct a multi-year study. The refund claims were audited by the IRS, and an engineer was assigned to the case. After the engineer retired, the local exam team engaged an R&D specialist from the IRS Issue Practice Network (“IPN”) as a consultant. On the first call with the client and TCC, the IPN specialist suggested that due to the lack of time tracking the entire claim should be disallowed.

    TCC Approach

    Technical Expertise:

    • Finding the conclusion from the IPN premature and unacceptable, TCC requested that the IPN write up its position so that the taxpayer could be provided a meaningful opportunity to respond.

    Collaborative Process:

    • Transparency and collaboration are two of TCC’s guiding principles in all dealings with both clients and the IRS. TCC spoke with the local IRS team management to explain our methodology and respond to the concerns raised by the IPN. The local team worked with both the IPN and the taxpayer to understand both parties’ respective positions and continued to audit the R&D claims. At the end of the multi-year examination, and with IPN review and approval, the issue was resolved with 85% of the R&D credits sustained.

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