NFFS Joins Manufacturing Coalition Urging Improvements to R&D Tax Credit

The Non-Ferrous Founders’ Society (NFFS) has joined a broad coalition of national manufacturing organizations in a formal sign-on letter to the U.S. Department of the Treasury, advocating for meaningful improvements to the Section 41 Research & Development (R&D) Tax Credit.

The letter highlights a growing concern across the manufacturing sector: while recent policy changes have strengthened the intent of the R&D credit, burdensome compliance requirements and restrictive interpretations are limiting its effectiveness—particularly for manufacturers.

For foundries, one of the most significant issues is the continued disqualification of “shop floor” research activities. Many of the process improvements, alloy development efforts, and production innovations that occur in a foundry environment are increasingly being treated as standard manufacturing expenses rather than qualified research. As a result, foundries are often unable to claim credits for the very activities that drive competitiveness and innovation.

In addition, members are feeling the impact of increased documentation and audit requirements. These expanded compliance burdens are forcing companies to dedicate more internal resources to tax reporting—often pulling engineering and technical staff away from their core focus on process improvement and product development.

The coalition is urging Treasury to take two key actions: first, to streamline compliance and audit procedures to better align with how manufacturers actually conduct research; and second, to clarify that research conducted in a manufacturing setting—including on the shop floor—qualifies for the credit.

NFFS joined this effort to ensure that the voice of nonferrous foundries is represented as policymakers consider the future of this important incentive. At a time when the industry is facing increasing global competition and rapid technological change, ensuring that the R&D tax credit works as intended is critical to supporting continued investment in innovation.

We will continue to monitor this issue closely and keep members informed as Treasury evaluates potential changes.