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The New Hampshire Research and Development (R&D) Tax Credit Program, established under RSA 77-A:5, XIII and administered by the Department of Revenue Administration (DRA), incentivizes qualified manufacturing research activities within the state. This nonrefundable credit offsets Business Profits Tax (BPT) and Business Enterprise Tax (BET) liabilities, supporting innovation in manufacturing.
Eligibility requires conducting qualified manufacturing research activities in New Hampshire that meet federal standards under IRC § 41, with wages tied to innovation in product or process development for manufacturing purposes. Businesses must apply annually and demonstrate excess over the base via federal documentation.
Note:New Hampshire’s R&D tax credit is strictly limited to wages only. Unlike the federal credit, the state does not allow supplies, contract research, cloud computing costs, prototype materials, or any non-wage expenditures. All qualifying wages must meet federal IRC §41 requirements and be tied to manufacturing R&D activities performed in New Hampshire.
New Hampshire uses the regular incremental method, based solely on in-state qualified manufacturing R&D wages. The credit is calculated as 10% of excess qualified wages over the base amount, subject to the $50,000 per-taxpayer cap and prorated if statewide requests exceed $7 million.
New Hampshire's R&D credit emphasizes manufacturing innovation with competitive allocation to ensure broad participation. Key provisions include strict caps and deadlines to manage the program's $7 million annual funding.
A New Hampshire-based precision manufacturing firm unlocked significant savings through targeted R&D claims.
The New Hampshire R&D tax credit provides a 10% credit on excess qualified manufacturing R&D wages over the base amount, capped at $50,000 per taxpayer and $7 million statewide, aligning with federal guidelines (IRC § 41).
Eligible activities involve developing or improving manufacturing products, processes, or software in New Hampshire, such as prototyping advanced materials or optimizing production techniques. Strike Tax identifies qualifying projects.
For $600,000 in excess qualified wages, you could save up to $50,000 (capped), plus federal credits. Use Strike Tax’s R&D Credit Calculator for personalized estimates.
Credits are nonrefundable but carry forward for 5 years. Small manufacturers can stack with federal payroll tax offsets for cash flow. Strike Tax maximizes benefits.
File Form DP-165 by June 30, either by mail or through the Granite Tax Connect portal, attaching federal Form 6765 (or pro forma). Strike Tax handles documentation and proration risks.
Yes, stack state and federal credits for the same qualified wages to amplify savings. Strike Tax optimizes claims across both.
No major changes for 2025; the $7 million aggregate cap remains. Legislation was proposed to increase the cap and per taxpayer limit, but it did not become law as of December 2025.
The base amount follows the federal Section 41 rules (fixed-base percentage times average gross receipts for the prior four years), except New Hampshire allows the minimum base amount to be zero. The state does not create a separate New Hampshire-only gross receipts base.
DRA prorates awards proportionally based on eligible excess qualified wages; historically the program has been oversubscribed, with reductions varying year to year. Strike Tax advises on strengthening applications.
The manufacturing focus and $50,000 cap provide targeted relief for NH's key industry, with 5-year carryforward ensuring long-term value. Strike Tax tailors claims for manufacturers.
Use our calculator to estimate your potential federal and state benefits.
Schedule a consultation to optimize your manufacturing R&D claims.