R&D Tax Credits for HealthTech Companies
We help HealthTech companies identify, document, and defend those credits while allowing engineering and product teams to stay focused on innovation
What Sets Us Apart
- California CPA License
- 8+ Years Specialized Experience
- Flat Fee Pricing Model
- Federal & State Credit Expertise
Do HealthTech Companies Qualify for the R&D Tax Credit?
In many cases yes , HealthTech companies frequently perform activities involving:
- Technical uncertainty
- Product experimentation
- Clinical workflow optimization
- Artificial intelligence development
- Data interoperability challenges
- Regulatory-driven engineering requirements
- Performance and scalability improvements
These activities often satisfy the IRS requirements for qualified research under Internal Revenue Code Section 41.
Why HealthTech Companies Frequently Qualify
Healthcare technology development is rarely straightforward.
Development teams often face questions such as:
- How can patient data be securely exchanged between systems?
- How can diagnostic accuracy be improved?
- How can clinical workflows be automated?
- How can healthcare AI models reduce false positives?
- How can patient engagement be increased?
- How can systems comply with HIPAA while maintaining performance?
- How can large healthcare datasets be processed efficiently?
Solving these technical uncertainties often creates eligibility for R&D tax credits.
Common Qualifying Activities
Healthcare Software Development
Examples include: (Electronic health record integrations, Patient portals, Revenue cycle management platforms, Practice management systems, Clinical workflow software)
Artificial Intelligence and Machine Learning
Examples include:(Diagnostic support systems, Predictive analytics, Medical imaging analysis, Clinical decision support tools, Risk scoring algorithms)
Interoperability Development
Examples include:(HL7 integrations, FHIR implementation, API architecture, Healthcare data exchange systems, Multi-platform integrations)
Digital Therapeutics
Examples include:(Treatment platforms, Patient monitoring systems, Behavioral health applications, Remote care technologies)
Medical Device Software
Examples include:(Embedded software, Device communication protocols, Data collection systems, Monitoring applications)
Activities That Usually Do Not Qualify
Examples often excluded include:
- Standard software implementations
- Routine data migration
- Basic reporting dashboards
- Customer onboarding
- Administrative work
- Routine maintenance activities
Qualification generally depends on whether genuine technical uncertainty and experimentation existed.
Typical Credit Range for Healthtech Companies
Credit size depends largely on technical payroll and development activity.
Technical Team Size | Typical Credit Range |
5–10 Employees | $50,000–$100,000 |
10–25 Employees | $100,000–$250,000 |
25–50 Employees | $250,000–$500,000+ |
Actual results depend on qualified expenses and project complexity
Section 174 and Healthtech Companies
Managing both effectively has become increasingly important for finance teams.
Most growing Healthtech businesses are affected by both.
Common Mistakes Healthtech
Companies Make
Drag to browse
01 / 05
Assuming Their CPA Handles It
Many general accounting firms do not specialize in software R&D credits.
02 / 05
Waiting Until Tax Season
Capturing documentation throughout the year simplifies the process significantly.
03 / 05
Underestimating Qualified Activities
Many companies only include obvious projects and overlook architecture improvements or infrastructure work.
04 / 05
Focusing Only on Federal Credits
State credits often create additional opportunities.
05 / 05
Ignoring Section 174 Requirements
Many startups were caught off guard by the capitalization changes.
Why Healthtech Companies Choose Us
We Understand Technology Businesses
We understand:
- Product development cycles
- Healthcare integrations
- AI development
- Technical documentation
- Software architecture
- Engineering workflows
Flat Fee Pricing
Most providers charge 20-30% of the credit.
We charge a predictable flat fee.
As your credit grows, our fee does not.
Documentation Built for Defensibility
Our goal is not simply maximizing credits.
Our goal is creating supportable and defensible claims.
Defensibility First
We maintain regular communication with founders and technical leaders throughout the engagement.
Long-Term Partnership
Quarterly check-ins simplify future claims and improve documentation quality over time.
FAQ
Does healthcare software qualify?
Frequently yes.
Healthcare software development is one of the most common qualifying activities.
Does AI development qualify?
Often yes.
Machine learning and predictive analytics projects frequently meet qualification requirements.
Do HIPAA compliance projects qualify?
Compliance activities alone generally do not qualify, but technical development required to achieve compliance often does.
Can startups qualify before profitability?
Yes.
The payroll tax offset can provide immediate cash flow benefits.
Are cloud computing costs eligible?
Some development-related cloud expenses may qualify.
Do contractors qualify?
In many situations, yes.
Vinit Gupta
Brendan Conaway
"You're a BAMF."
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