02 Aug 2024
Congratulations on 2nd place!
Congratulations on 2nd place! We at innoscripta would like to congratulate the Indian Jump Rope Team on their outstanding success in the Double Under Relay event at the Asian Jump Rope Championships! This great achievement fills us with pride and we are honored to be partners with such talented athletes.
Our commitment to elite sport goes beyond mere support. At innoscripta, supporting top athletes and giving them the opportunity to pursue their goals is a core part of our company values. We know how important it is to have a strong partner at your side in order not to lose focus and to achieve top performance.
A strong team needs strong partners, and that's exactly what we want to be for the Indian Jump Rope team. We look forward to the future together and to continuing to support the team on their journey. Congratulations again to the whole team on this impressive achievement!
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10 Aug 2026
Der Bank Blog features Sebastian Schwertlein on R&D potential and innovation financing in the financial sector
The guest article by innoscripta COO Sebastian Schwertlein in Der Bank Blog examines how banks, insurers and FinTechs can systematically assess technology development projects in areas such as AI, data analytics, cybersecurity and automated processes from an R&D perspective. The article explores the research allowance as a component of modern innovation financing and highlights how structured documentation and specialised digital platforms can efficiently support R&D processes. Read more: https://www.der-bank-blog.de/viele-banken-lassen-millionenschweren-innovationshebel-ungenutzt/innovation/37733674/
13 Aug 2026
Maximizing Qualified Research Expenses (QREs) for the US R&D tax credit: A strategic framework for CFOs and tax leaders
In an era defined by rapid innovation and technological disruption, the Research and Development Tax Credit under Internal Revenue Code (IRC) Section 41 is one of the most powerful monetary tools available to US enterprises. For high-growth firms, this opportunity can translate into financial support in terms of immediate tax savings and increased cash flow.Despite this direct opportunity, many companies pursuing innovation fail to capture the full economic value of their novel initiatives. The main reason for not leveraging this federal-level opportunity is not a lack of eligible innovative activity, but rather a failure to establish a systematic operational framework to recognize, document, and substantiate Qualified Research Expenses (QREs). To maximize the credit, tax leaders must adapt their perspective from viewing the R&D credit as a year-end compliance task to considering it as a continuous operational discipline.What are QREs?To optimize a claim, it is crucial to be familiar with the statutory IRS definitions of the three primary costs. The IRS provides a meticulous roadmap for which expenditures qualify as QREs.1. Qualified wagesThe category of qualified wages constitutes a significant portion of any R&D claim, and it includes the “Box 1” taxable wages paid to employees for qualified services. This consists of personnel in direct supervision and direct support roles, along with the engineers and scientists performing R&D.2. Qualified suppliesThese are tangible, non-depreciable assets used and consumed during the R&D process. For example, chemicals for lab testing and materials used for building prototypes specifically for qualified research activities.3. Contract research expenses65% of the total costs incurred for hiring a third-party research firm to perform the R&D project on the company’s behalf are eligible for the credit claim.Why valuable QREs go unrecognizedDespite having eligible activities, many companies submit insufficient R&D claims. The loss of value usually arises from three core elements:Fragmented data ecosystemsIn many companies conducting R&D, the data needed for a well-substantiated claim is scattered across different systems. For example, technical activities recorded within Jira or Azure DevOps, payroll information in ADP, and operational or supply costs recorded in the general ledger. Without a unified and interconnected system that offers holistic documentation, these data points become subject to guesswork. An intuitive platform such as innoscripta’s Clusterix bridges the gaps in project documentation, ensuring zero omission of information and audit readiness.Risk of retroactive reconstructionThe IRS has signalled a remarkable change toward requiring contemporaneous documentation. Hence, depending on year-end interviews or retrospective surveys to substantiate a significant amount of credits is a high-risk strategy. If documentation was not created simultaneously at the time of the research work, the IRS may consider the claim ‘unsubstantiated.’Misclassification of activitiesCertain companies often view R&D as involving only successful outcomes or cutting-edge inventions. However, Section 41 provides for a broader inclusion. Iterative development, failed experiments, and process improvements intended to eliminate technical uncertainty are considered valid activities upon which the R&D credit claim could be based. Many companies leave significant QREs unclaimed, as they never document the ‘process of experimentation.’Five strategies to maximize QRE capture1. Implementing activity level trackingTo maximize wage QREs, companies should move away from overall percentage-based time estimates. By implementing task-based time tracking for project work, tax leaders can defend every hour mentioned in the claim with granular data. This includes capturing ‘direct support’, for example, a lab technician cleaning the equipment used for qualified research, and ‘direct supervision’, for example, a CTO reviewing technical roadblocks.2. Mapping expenses against business componentsThe IRS demands that every dollar claimed be tied to a specific business component, which may be a product, process, or software. When a claim merely lists the total sum of wages without breaking them down into components, it is considered a negative indicator to auditors. A company must demonstrate a clear link between the expense and the specific task for which it was incurred.3. Including supply and contractor costsFor a company, the ability not to overlook hidden R&D costs brings a lot of value to their claim. Elements such as testing supplies, and prototype materials are examples of this. In the case of contract research, the company needs to ensure that the official contract specifically states that they retain substantial rights and bear the economic risk of the research, which are two critical factors for eligibility.4. Integrating technical, financial, and substantiating recordsMaximizing QREs requires a three-way match between the technical narrative, the financial records, and the substantiating evidence. In other words, the alignment between what was done, what was spent, and the proof that it happened is a crucial factor in a successful claim. The methods to ensure this include aligning the ERP and project management software, where these three pillars are accurately synchronized.Examples of this include payroll information tied to research activities, financial records tied to respective projects, and engineering work tied to experimentation.5. Following the consistency ruleUnder Section 41, the R&D credit is incremental, comparing current spending against a base period. It requires that QRE calculations remain consistent across years, and base-period comparisons must align with the current methodology. If there are new QREs this year that were previously uncaptured, the IRS would require the company to update the base period for consistency. If a company skips updating the base period, during an audit, the IRS will recalculate and inflate the base period, which will significantly shrink the claim or eliminate it entirely.ConclusionMaximizing QREs is not just about discovering more expenses; rather, it is about building a defensible system that captures the R&D project comprehensively. From the IRS’s perspective, if it is not contemporaneously documented, it did not happen. The transformation from retrospective estimation to real-time infrastructure is the foundational step a CFO or tax leader can adopt to enhance their R&D tax benefits.When companies realize that the R&D tax credit is a continuous opportunity, they transform their manual spreadsheets and year-end information gathering into automated and systematic documentation that records the project contemporaneously. As a result, they achieve maximum capture of QREs and audit readiness.
