Stern Industries finds high returns from the R&E Tax Credit

Stern Industries of Baxter, Minnesota, is a plastics and rubber manufacturing company that uses a wide range of production methods including injection molding, rotational molding, blow molding, extrusion, thermoforming, and UHMW technologies. Stern provides a customer-focused design, engineering, and manufacturing service.

Stern’s CEO believed the tax credit could potentially result in a high return for the company. However, he had two concerns: not having a feel for the potential dollar available and not being comfortable with the documentation requirements. Therefore, he turned to TCS Consulting, a consulting firm led by engineers who specialize in the credit. While not involved in this particular project, TCS often partners with Christianson & Associates, PLLP, a CPA firm with the R&E tax credit experience needed to handle the accounting and legal aspects.

The Project

TCS first conducted a feasibility study to identify a number of large projects done over the past three years and to develop estimates of the potential expenses related to each project. TCS also conducted a training seminar for production and technical staff to help them understand the broad spectrum of their project work which qualifies for the credit.

After analysis and verification, the estimated potential return for a full documentation project was in excess of $130,000. The company then worked on documenting projects and submitting them for the credit. A partial listing of projects and their potential return is included below