Civil engineering firms — companies that design site, infrastructure, transportation, water, and similar projects — may perform activities that warrant analysis under the federal R&D tax credit. This page explains what development work may be relevant. It is educational and is not individualized advice. For the foundational framework, see our page on qualified research.
What R&D May Look Like in Civil Engineering
Civil engineering involves site and infrastructure systems, materials, geotechnical, and hydraulic and structural design. Work directed at resolving genuine technical uncertainty in these areas may warrant review. Routine engineering and standard practice do not, by themselves, constitute qualified research.
Industry-Specific Examples of Technical Development
- Developing site or infrastructure systems to achieve a specified performance or cost target where the appropriate design is uncertain.
- Testing alternative materials or treatment approaches for soil, pavement, or infrastructure where the capability is uncertain.
- Developing geotechnical approaches for difficult conditions where the appropriate method is uncertain.
- Developing hydraulic or drainage systems to meet a specified performance target where the appropriate design is uncertain.
- Developing structural designs for infrastructure to meet a specified target where the appropriate approach is uncertain.
- Developing processes to improve quality or reduce cost where the method is not established.
Technical Uncertainty Examples
- Whether an alternative infrastructure system can achieve a specified performance target.
- Whether a modified geotechnical approach can resolve a difficult site condition.
- Whether an alternative material can meet a performance and durability target for a specific application.
Process-of-Experimentation Examples
A process of experimentation may involve modeling or simulating alternative designs and measuring performance, testing alternative materials and evaluating results, or conducting field tests and measuring performance.
Potential Business Components
Potential business components may include a new or improved site or infrastructure system, a new or improved material or treatment, a new or improved geotechnical approach, or a new or improved hydraulic or structural design.
Employee and Contractor Work
Employees whose work may warrant analysis include civil engineers, geotechnical engineers, structural engineers, materials engineers, and water-resources engineers. Contractor work may include outside testing laboratories or consultants performing development work on behalf of the firm.
Activities That Generally Require Caution or May Not Qualify
- Routine engineering and design following established methods.
- Standard sizing and selection using established methods.
- Ordinary coordination and project management.
- Simple material selections without a technical development question.
- Routine site inspection and testing.
Documentation That May Help
Records that may help include design development records, modeling or simulation results, material or field test data, and records connecting personnel to specific development projects.
Example Hypothetical Project
The following is a hypothetical example for illustration only.
A civil engineering firm is developing a pavement system for a heavy industrial application intended to achieve a specified durability target under difficult loading. The technical uncertainty is whether an alternative combination of materials, layer design, and construction method can achieve the specified target. The team models alternative designs, tests materials, and evaluates field performance. Professional review is still needed.
Questions to Ask Internally
- What specific system, material, or approach was being developed or improved?
- What technical uncertainty existed at the outset?
- How does this differ from routine engineering?
Relationship to the Four-Part Test
The four-part test applies the same way as in any industry. The work must satisfy all four elements: permitted purpose, technological in nature, elimination of uncertainty, and process of experimentation.
Key Takeaway
Civil engineering firms may perform activities that warrant analysis under IRC §41 — particularly work involving site and infrastructure systems, materials, geotechnical, and hydraulic and structural design. Routine engineering does not automatically qualify. Because these determinations are fact-specific, professional review is appropriate. For related industries, see structural engineering firms and construction companies.