North Carolina R&D Tax Credit Summary

NORTH CAROLINA R&D TAX CREDIT SUMMARY

North Carolina State R&D Tax Credit

The North Carolina credit for research and development has been repealed effective January 1, 2016. Prior to January 1, 2016, a credit was available equal to a percentage of the expenses as follows:

  • Small businesses—3.25%
  • Research performed in a development Tier 1 area— 3.25%
  • North Carolina research university expenses—20%
  • Eco-industrial park—35%
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    Effective for taxable years beginning on or after January 1, 2011, other research expenses:

    • 1.25% for expenses up to $50 million
    • 2.25% for expenses between $50 million and $200 million; or
    • 3.25% for expenses above $200 million

    How to Obtain the Credit?

    File Form NC-478I

    Refundable/Transferable Tax Credit – No

    Carryforward

    Unused R&D tax credits may be carried forward for up to 15 years.

    Flow-Through Entities

    This credit can be used by S Corporations claiming the credit against income tax, partnerships, trusts and estates.

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