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White-Label Manufacturing

Using a white-label manufacturing company is a smart and efficient way for new cannabinoid and hemp product companies to rapidly enter an increasingly competitive market. These companies employ experienced formulators to determine the best cannabinoid combinations for the desired effect, and research additional ingredients to round out the product. The creation of new recipes requires significant investments in research and development (R&D) on the part of white-label manufacturing companies. Fortunately, some of these costs can be recouped through the R&D Tax Credit.

The R&D Tax Credit is an activities-based credit. Employee wages, raw materials and supplies, and third-party contractor costs associated with R&D activities are considered qualified research expenses (QREs). Companies can receive refunds of up to 22% of total QREs through federal and state tax credits, depending on the state in which your business operates.

Example activities that qualify:

  • Assessing various cannabinoid combinations, formulations, and concentrations
  • Infusing cannabinoid ingredients for client, product, and compliance specifications
  • Analyzing different hemp sources for cannabinoid content, purity, and ratios
  • Evaluating various terpene and cannabinoid formulas and ratios
  • Improving the extraction process for efficiencies, yields, and optimal results
  • Developing new recipes and creating test samples
  • Testing and implementing scaled-up manufacturing processes for a new product
  • Contracting third-party testing to ensure end product meets regulatory standards

Do you have these job titles on your payroll, or do you hire third-party contractors to do these jobs?

  • Analytical Chemists
  • Botanists
  • C-Suite
  • Compliance Personnel
  • Consultants
  • Cultivation Specialists
  • Director of R&D
  • Extraction Engineers
  • Formulators
  • Laboratory Technicians
  • Master Extractor
  • Process Engineers
  • Product Development Managers
  • QA/QC Personnel

Use our Hemp Tax Calculator to estimate your potential benefit, and partner with HempTax to claim your benefits with no up-front costs. Contact one of our experts today.

Want a quick estimate for your company?

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Got questions? Schedule a quick call with an R&D expert.

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How much could I get back in R&D tax credits?

Great question! Try out our R&D Tax Credit Calculator to see the value of your R&D tax credit reward.
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