Utah R&D Tax Credit Summary

Utah R&D tax credit, R&D Tax Credit

Utah State R&D Tax Credit

Utah offers a tax credit for research activities conducted in Utah, detailed within Utah Code Section 59-10-1012.

The credit amount equals the sum of the following three expenses:

  • a research tax credit of 5% of the taxpayer’s qualified research expenditures for the current taxable year exceeding a base amount
  • a 5% credit for payments to qualified organizations for basic research as provided in IRC §41(c) for the current taxable year that exceed a base amount; and
  • a tax credit of 7.5% of qualified research expenses in Utah for the current taxable year

The base amount is calculated as provided in IRC §41(c) and IRC §41(h), except that:

  • it does not include the alternative incremental credit provided for in IRC §41(c)(4)
  • the taxpayer’s gross receipts include only those amounts attributable to Utah sources under the allocation and apportionment provisions; and
  • for purpose of calculating the base amount, a taxpayer may make an irrevocable election to be treated as a start-up company regardless of whether the taxpayer meets the requirements of IRC §41(c)(3)(B)(i)(I) or IRC §41(c)(3)(B)(i)(II)

How to obtain the credit? 

The credit amount should be entered on Utah Form TC-40A, Income Tax Supplemental Schedule, Part 4, using code 12.

Refundable/Transferable Tax Credit – No


For the first two amounts above, any excess credit not used for the taxable year in which it is earned may
be carried forward as a credit for the next 14 taxable years. Any unused credit under the third amount above
may not be carried forward.

Find out if you qualify for the R&D tax credit

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If your company hasn’t considered the R&D credit in the past because you have net operating losses (NOLs) and could not utilize the credit contact us today to find out which states allow you to sell your credits and losses for up to 95 cents on the dollar. Also, qualified start-up companies can now take a credit on their payroll taxes for their R&D credit, allowing your company to utilize the R&D credit immediately, even if your company does not have taxable income.

States and the R&D Credit:

South Dakota
West Virginia
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