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it “incident to” engineering. Petitioner’s geotechnical testing
services are not dependent upon petitioner’s ability to provide
engineering services. It was not unusual for clients to request
petitioner’s geotechnical testing services exclusive of a
subsequent engineering analysis. In the alternative, an
engineering analysis may be completed by data furnished by a
third party, not necessarily petitioner’s own geotechnical
testing department. Specific services provided by petitioner
varied depending upon the unique request of the client.
Moreover, administrative and support services provided for
engineering analyses may be separated from the administrative and
support services provided for geotechnical testing services.
Since we have decided that geotechnical testing is not in
the field of engineering, a qualifying service, then we must next
decide how much of petitioner’s time was spent in petitioner’s
engineering services. According to the temporary regulation,
substantially all or 95 percent of petitioner’s employees’ time
must be devoted to rendering a qualifying service under section
448(d)(2).
Petitioner proffered evidence demonstrating the overall
breakdown of testing and engineering services rendered during the
years in issue by dollar amounts reflected in invoices. From the
invoices in the record, we find that petitioner’s engineering
services were billed between $80 and $110 per hour, depending on
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Last modified: May 25, 2011