Research Activities (code 12)

The credit is for expenses incurred for increasing qualified research activities in Utah. A qualifying taxpayer may claim the credit in the taxable year immediately following the taxable year for which the taxpayer qualifies for the credit. The credit is nonrefundable, meaning it may not exceed the tax due for the year, but any excess credit may be carried forward for 14 years.

A qualifying taxpayer may take the following nonrefundable credits for research activities in Utah:

1. A research credit of 6 percent of the taxpayer's qualified research expenses for the current taxable year that exceed the base amount; and
2. A credit for payments to qualified organizations for basic research, as provided in IRC Section 41(e), of 6 percent for the current taxable year that exceed the base amount.

For detailed information regarding this credit, including definition of terms and procedures for claiming the credit, refer to UC §59-10-1012.

Tax Credit for Machinery and Equipment Used to Conduct Research (code 13)

The credit is for machinery, equipment, or both used primarily for conducting qualified research or basic research in Utah for not less than 12 consecutive months. A qualifying taxpayer may claim the credit in the taxable year immediately following the taxable year for which the taxpayer qualifies for the credit. Any excess credit may be carried forward for 14 years. A qualifying taxpayer may take the following nonrefundable credits:

1. A credit of 6 percent of the purchase price of certain machinery and equipment primarily used to conduct qualified research in Utah; and
2. A credit of 6 percent of the purchase price of certain machinery and equipment donated to a qualified organization and used primarily to conduct basic research in Utah.

For detailed information regarding this credit, including definition of terms and procedures for claiming the credit, refer to UC §59-10-1013.