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In an era where technology is transforming every aspect of business, the field of R&D tax credits is no exception. Artificial Intelligence (AI) is now being harnessed to automate and facilitate the claiming of R&D tax credits, replacing traditional manual methods that are often time-consuming and error-prone. This is especially relevant for machine shops, where innovative activities abound, but the process of identifying and documenting these for tax credit purposes can be challenging.
Unlocking R&D Tax Credits with AI
AI has proven to be a game-changer in the preparation of R&D tax credit claims. Companies can now leverage AI to prepare these claims with less time and higher precision. Sector-specific trained Learning Logic Machines (LLMs) are at the heart of this transformation. These AI systems are trained to identify activities that are eligible for R&D tax credits, meet the 4-part test, describe technical uncertainties faced, and technological advancement gained.
Streamlining Documentation with LLMs
Detailed technical reports are an integral part of the R&D tax credit claiming process. A highly trained sector-specific LLM can assist in writing these reports, preparing drafts for managers and consultants, and accurately representing the work done by machine shop employees. LLMs can be used to track qualified research activities aimed at resolving technical uncertainties, based on employee and contractor analytical and experimental activities.
It is difficult to think of a major industry that AI will not transform. This includes healthcare, education, transportation, retail, communications, and agriculture. There are surprisingly clear paths for AI to make a big difference in all of these industries.- Andrew Ng, Computer Scientist and Global Leader in AI
Efficient Expense Tracking
Beyond identifying and documenting R&D activities, AI also simplifies the tracking of qualified research expenses. A trained LLM can manage a claimant’s time surveys, employee activities, contractor activities, and supplies used during experimental trials. This significantly reduces the time load on employees who would otherwise need to manually track their project progress.
R&D Study Creation and Future of R&D Tax Credits
AI can even be used to create an R&D study, replacing traditional consulting methods that are often cost-prohibitive for many machine shops. A trained LLM can connect to existing project management, ERP, and accounting systems, automatically capturing eligible activities in real-time for larger and complex claims. The future of R&D Tax Credits indeed lies with LLMs and AI.
Get Your R&D Tax Credit Estimate Today
There’s no denying that AI has revolutionized the process of claiming R&D tax credits for machine shops. If you’re keen to explore how much your R&D Tax Credit can be, click on the button below to obtain an estimate. Embrace the power of AI and transform your tax credit claiming process today.
