Kentucky R&D Tax Credit Summary

KENTUCKY R&D TAX CREDIT SUMMARY

Kentucky State R&D Tax Credit

A tax credit equal to 5% against the corporate or personal income taxes and the limited liability entity tax for qualified construction costs of research facilities is available to qualified taxpayers.

“Qualified research” means qualified research as defined under IRC § 41.

“Construction of research facilities” means:

  • constructing, remodeling, and equipping facilities in Kentucky; or
  • expanding existing facilities for qualified research; and
  • only includes tangible, depreciable property

It does not include any amounts paid or incurred for replacement property.

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    How to Obtain the Credit?

    Fill out Schedule QR and attach it to Form 720720S725765 or 765-GP.

    Refundable/Transferable Tax Credit – No

    Carryforward

    If the credit amount that an investor can claim in a given tax year exceeds the investor’s income tax liability for that year, that investor can carry forward the excess tax credit until the tax credit is used, up to 10 years. Any tax credits not used within 10 years are forfeited.

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