New York maintains that in order for a taxpayer to qualify for a research and development exemption the use of the equipment (e.g. computers and software) in question must clearly be for direct use in research and development. A taxpayer petitioned an audit finding that determined some of their equipment used did not qualify for a research and development exemption. The Tax Appeals Tribunal found that the equipment was being used to organize their research data in a way that would provide value to their clients. Even though actual research information was a focus, the equipment in question was not used directly and predominantly in research. (Tax Appeals Tribunal, In the Matter of the Petition of Impath, Inc., Docket No. 818143.)