Phase 2: Technological Uncertainties

Illustrating Technological Uncertainty:

“the capability or the method of achieving that

result, or  the appropriate design (to achieve) that result, is uncertain as of the beginning of the taxpayer’s research activities.” 1

“discovering information … does not require that the taxpayer succeed in developing a new or improved business component.” 2

Recommended Documentation Method:

This is often best illustrated by defining the top 5 variables of uncertainty which are;

  • Under the researchers control & 
  • Intended as basis for experimentation

Once the team agrees on these uncertainties the related research is typically eligible.

1. IRS code Section 41(d)(1 & 4)

2. Regulations  to S.41(3)(ii)