Case Study

R&D Case Study: Align Agro Claims Tremendous Tax Credit

    • 15-05-2023
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Hemp and Cannabis

60% Employees Time and 89% Supplies R&D Qualified

Learn how Align Agro, successful hemp farm startup, was able to thoroughly understand their processes and activities to build a substantive R&D Tax Credit claim.

How They Were Innovating

Among others, the two biggest qualifying R&D projects at Align Agro included:
1) Optimization of CBG and CBD based varietals
2) Optimization of industrial hemp varietals: grain and fiber. These cultivars have to be grown in different conditions. Our client tested different greenhouse conditions, soil amendments, irrigation methodologies, transplantation techniques, and a plethora of industrial and flower strains.

Additionally, they are also implementing Integrated Pest Management (IPM) solutions to eliminate pests and improve the overall health of their crops. Other qualifying projects include evaluation of 14 different fiber and grain varietals to determine their viability given local growing conditions. Leyton’s hemp team will be working with this client to plan and document future R&D projects like cover crop testing.

We were able to qualify the client’s time conducting research and development activity at 60% and the supplies used at 89%. These supplies included seed costs, soil amendments, water costs, bio-pesticides, and more.

Impact of the R&D Tax Credit

Once we had identified all of the qualifying activities that Align Agro was undertaking, Leyton’s hemp and agriculture team gathered and qualified the related expenses to these research and development projects.

Leyton’s industry experts and tax specialists worked hand in hand with Align Agro to thoroughly understand their processes and activities to build a substantive R&D Tax Credit claim. Business Owner, Rusty Peterson, refers to working with Leyton as, “an amazing experience. It was really nice to see a dedicated team come together and really took the time to understand a small operation like my business. I was really impressed.” Our teams conducted an R&D study for 2019 and 2020 and identified a federal credit for the client, which they chose to carry forward to use it next year when they anticipate an income.

Our engagement with the client continues as Leyton’s financial experts are now helping the client build the R&D Tax Credit as a long-term financial tool and helping with their books to account for the client’s R&D expenses respectively.

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Everything was easy-peasy! Leyton teams went above and beyond. People got back to me quickly, even with a 3 hour difference. I’ve told a couple of people about this credit already and it doesn’t cost you anything to look at it. You literally have nothing to lose!

Rusty Peterson Align Agro

Do you own a hemp or agriculture business? Discover if you qualify.

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