Demistifying the R&D Credit for Agriculture
Learn which agricultural activities qualify for the R&D tax credit. From irrigation to precision farming, learn how everyday innovation meets IRS criteria.
Mark Stapleton | Director of Quality Control, SPRX
Oct 2, 2025
Fewer than 3 in 10 businesses that qualify actually claim the R&D tax credit (U.S. Chamber of Commerce).
Most miss out because of confusion about eligibility and the perceived complexity of filing.
The reality is R&D doesn’t just happen in labs. In agriculture, it happens in the field through small, deliberate experiments that drive measurable improvements.
If your team is testing new ways to grow, harvest, or conserve resources, that’s not guesswork. It’s qualified research. And it deserves to be recognized.
At SPRX, we help agriculture businesses understand which activities qualify for the R&D tax credit and why. Read this guide to get a clear understanding of the qualified research activities (QRAs) that could apply to your work.
Types of Agriculture Companies that Qualify
Animal Husbandry and Genetics
Farming and Crop Science
Livestock Management
Agricultural Equipment Development
Egg Production
Nut Growers
Dairy Farming
Feedyards
Poultry
Pork Production
Swine Production
Vineyards
What Counts as Qualified Research Activities in Agriculture
If your work sounds like this, it’s R&D:
Testing fertilizer mixes to increase yield
Developing or improving irrigation systems
Using precision farming to reduce inputs and improve efficiency
Creating new or improved crop strains
Refining harvesting techniques to minimize waste
Each of these activities fits the IRS Four-Part Test for Qualified Research.
IRS Four-Part Test for R&D Credits
Each of these activities meets the IRS four-part test (Section 174) for Qualified Research:
Purpose: Improving a product, process, or method
Technology: Grounded in agricultural or engineering principles
Uncertainty: Testing to find what performs best
Experimentation: Measuring, comparing, and refining results
IRS Test | What It Means (Plain English) | How SPRX Documents It |
|---|---|---|
Permitted Purpose | You’re improving a product, process, technique, or system — making it better, faster, stronger, or more efficient. | SPRX maps each project objective to its qualifying purpose, ensuring it meets the improvement threshold. |
Technological in Nature | The work is based on engineering, computer science, biology, or physical sciences — not just design or aesthetics. | SPRX classifies projects by the underlying field of science to meet IRS standards. |
Elimination of Uncertainty | You didn’t know if your idea would work — and had to figure it out. | Our platform captures the unknowns you tested and the decisions that resolved them. |
Process of Experimentation | You ran tests, trials, models, or prototypes to find the best approach. | SPRX translates that experimentation into audit-defensible documentation. |
Why Agriculture Work Qualifies as R&D
Agricultural progress relies on structured experimentation. Every test of a fertilizer mix, every trial run of an irrigation pattern, every new planting technique is an act of research and development.
SPRX identifies and documents this work, linking it to the IRS criteria so your credit claims are complete, accurate, and defensible.
Estimate your Agriculture Company’s R&D Credit Potential
Once you understand what qualifies, the next question is simple: What could it be worth?
Estimate your potential credit with the [SPRX R&D Credit Estimator]
The Takeaway for Agriculture Companies
Innovation in agriculture doesn’t always start in a lab. It starts in the field, with curiosity, measurement, and persistence.
If you are improving how food is grown, processed, or delivered, you are doing the kind of work the R&D tax credit was designed to reward.
SPRX helps you capture that value with precision, clarity, and confidence.
Get in touch if you want help claiming your R&D credit.
