R&D Tax Credits in Logistics & Supply Chains: Innovation Beyond Transportation

When many industry leaders think about research and development (R&D), they picture laboratories, scientists, or product engineering teams, not warehouses, routing software, or fulfillment operations. As a result, logistics, distribution, and supply chain companies can overlook a valuable financial incentive they may already qualify for: the R&D tax credit.

What Are Federal and State R&D Tax Credits?

The R&D tax credit is a federal and state-level incentive that rewards companies that invest in innovation and technical problem-solving in the United States. Rather than being a grant or deduction, this dollar-for-dollar tax credit directly reduces tax liability.

At the federal level, the credit generally applies to:

• Wages paid to U.S. employees engaged in qualified R&D activities,
• Certain domestic contractor costs supporting those activities,
• Supplies consumed in the R&D process, and
• Cloud-hosting space or computer lease for software development.

For logistics and supply chain companies taking advantage of the R&D tax program, potentially qualified wages include those of engineers, analysts, operations leaders, and technical teams involved in testing and optimizing products, processes, and software.

Many states also offer their own R&D tax programs, which can be claimed alongside the federal incentive. While each state’s rules vary, state programs often follow the federal eligibility criteria for activities and expenses, so participating at both levels can significantly increase the total reward for R&D.

What Qualifies as R&D in Logistics & Supply Chains?

To qualify for the R&D tax credit, activities must meet the Internal Revenue Service (IRS)  Four-Part test, including a process of experimentation aimed at answering technical questions. In logistics and supply chain environments, this often shows up in practical, real-world ways.

Commonly qualified R&D activities include:

• Cold Chain & Specialized Handling
  • Improving temperature-controlled storage or transport processes
  • Testing packaging durability or insulation performance
• Inventory & Demand Forecasting
  • Building or refining forecasting models
  • Reducing stockouts or overstock through iterative analysis
  • Testing inventory allocation strategies across multiple locations
• Routing, Transportation & Load Optimization
  • Developing routing algorithms to reduce fuel costs or delivery time
  • Experimenting with last-mile delivery methods or scheduling models
  • Testing alternative load-balancing strategies
• Systems Development & Process Innovation
  • Creating custom software to support operational goals
  • Architecting Enterprise Resource Planning (ERP), Warehouse Management Systems (WMS), Transportation Management Systems (TMS), and Internet of Things (IoT) platforms
  • Testing data flows, reporting logic, or real-time tracking capabilities
• Warehouse & Fulfillment Optimization
  • Designing and testing new warehouse layouts to improve throughput
  • Evaluating automation solutions such as robotics, conveyors, or picking systems
  • Iterating on storage configurations to reduce handling time or error rates

Importantly, these R&D activities do not need to succeed to qualify.

Failed attempts, abandoned approaches, and iterative refinements are often the strongest indicators of R&D.

Where Does the “Process of Experimentation” Show Up?

In logistics, experimentation rarely looks like a lab experiment, but it is experimentation nonetheless.

Examples include:

• Pilot programs launched in select warehouses
• A/B testing different picking or routing strategies
• Iterative system improvements based on performance data
• Optimizing parameters such as time, distance, capacity, and sequencing to predict outcomes

If teams are testing multiple approaches, analyzing results, and refining solutions to overcome technical uncertainty, they are likely engaging in qualifying R&D.

How Does Acena Help Logistics & Supply Chain Companies?

At Acena Consulting, we help logistics and supply chain organizations uncover and document R&D activities that are often hiding in plain sight.

Our approach focuses on:

• Coordinating the collection of financial and technical documentation across operations, information technology (IT), and finance teams,
• Identifying qualifying expenses and projects without disrupting day-to-day operations,
• Translating operational innovation into defensible R&D narratives, and
• Preparing audit-ready documentation aligned with IRS standards.

The result is a tax credit claim that accurately reflects your innovation and stands up to scrutiny.

Not sure where to start? A preliminary R&D tax credit assessment can help determine whether your recent projects qualify and how much untapped opportunity may be available.

Connect, Learn, and Maximize R&D Tax Credits

Don't leave money on the table. Connect with Randy Eickhoff, CPA, Acena Consulting's Founder & Head Coach, for a complimentary R&D consultation to get the most out of your taxes.

Register for our free monthly webinar, next on Feb. 17, 2026: Cracking the (Tax) Code for R&D.

• This workshop provides one continuing education (CPE) credit for professionals maintaining their continuing education (CEs).
• Discover more about qualifying and documenting R&D activities to receive tax incentives.

Visit our Acena Events page to sign up for our newsletter and stay abreast of all upcoming events.

Follow Acena on LinkedIn and X for the latest industry-specific incentives and tax policy updates.

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Photo courtesy of Gwan Kho on flickr.