North Carolina R&D Tax Credit Repeal

North Carolina R&D Tax Credit Repeal

Posted by Jeffrey Feingold on 02.27.18

Research and development consists of innovative activities undertaken by corporations in developing new services or products, or improving existing services or products. R&D is essential for a business to stay on top of their industry.

Federal Research & Development (R&D) tax credits are being utilized throughout the country. These tax credits give businesses incentives to explore and test new ideas for better products and technology, to help keep their business moving forward. Most US states also offer R&D credits to go along with the Federal tax credits that should be put to use.

On January 1, 2016 North Carolina repealed their state R&D tax credit. Prior to that a credit was available that was equal to the percentage of expenses in the following manner:

  • Small businesses - 3.25%
  • Research performed in a development tier 1 area - 3.25%
  • North Carolina research university expenses - 20%
  • Eco-Industrial Park - 35%

Other research expenses for taxable years beginning on or after January 1, 2011:

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

It's important to note that unused North Carolina R&D tax credits may be carried forward for up to 15 years.

The R&D tax credit can be a lucrative incentive for North Carolina businesses. Now is the time to consider whether activities performed by your company qualify for major cash-saving federal and state tax credit opportunities.

Request a free assessment to determine qualifying R&D tax credit eligibility.

Tax Point Advisors, a firm with expertise in working with small and midsize companies, works with businesses that may qualify for R&D tax benefits.

For more information, read our e-book: The Business Owner's Guide to R&D Tax Credits.

You may also contact us at (800) 260-4138, or please leave us a message below. 


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