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FAQ: 

Which states offer R&D Tax Credits?

Listed below are some of the most frequently asked questions our team receives about R&D tax credits

Which states offer R&D Tax Credits?

The definition of qualifying research activities in each state is based on the federal tax credit regulations; however, the calculation methodology varies significantly from state to state. For example:

  • Some states provide a refund or exchange of unused R&D Tax Credits, so that even if a taxpayer has no tax liability it can still derive a cash benefit.
  • The R&D Tax Credits in some states have not been permanently adopted, and may expire in the future.
  • Most states require that the research activities must be conducted within their borders to qualify.
  • Some states do not offer the alternative simplified credit calculation.
  • In some states, basic research payments made to universities and certain non-profit organizations can be included in the calculations.

There are 38 states that currently allow taxpayers to claim the R&D Tax Credit. Below is the list of states that DO NOT offer the R&D Tax Credit:

  • District of Columbia
  • Missouri
  • Mississippi
  • Montana
  • Nevada
  • Oklahoma
  • Oregon
  • South Dakota
  • Tennessee
  • Washington
  • West Virginia
  • Wyoming

Refer to our state pages for state-specific information.

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