New Jersey R&D Tax Credit Summary


New Jersey State R&D Tax Credit

In general, corporate entities are allowed a credit against the corporation business tax for qualified expenditures with respect to research conducted in New Jersey. Details are as follows:

  • The amount of the credit allowed equals 10% of the excess of the qualified research expense for the fiscal or calendar year over a base amount and 10% of the basic research payments
  • The credit is only available to C and S corporations
  • A New Jersey S corporation’s credits are limited to its New Jersey corporation tax liability and pass-through of the credit to the individual shareholders isn’t permitted
  • The credit is not available to partnerships and other pass-through entities
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    How to Obtain the Credit?

    For taxable periods beginning on and after January 1, 2013, complete Form 306.

    Refundable/Transferable Tax Credit – Yes*

    The credit can be sold through the NJ Tax Certificate Transfer Program*


    Unused research and development credits may be carried forward for up to seven years.

    Flow-Through Entities

    A New Jersey S-Corporation is allowed to claim a credit in connection with increasing research activities to the extent of its New Jersey corporation tax liability. Pass through of this credit to shareholders is not permitted.

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