The federal credit is only half the story.

Most states with a corporate income or franchise tax run their own R&D credit - and most companies that claim the federal one never capture it. Ricerca computes both, from the same substantiated qualified-research base, inside a single study.

Get your free credit estimate Estimate the federal credit

Why a state credit is its own job

Every state defines its own base. A federal number times a state rate is not a state credit.
State scope is narrower: the work has to have happened there.
Rules are versioned by tax year, so an amended prior year gets the law that applied then.
Some states have no credit at all. Saying so is part of the work.

The registry, mapped

Where a state R&D credit exists for TY2026

Coloured from the same rules registry the study engine computes from - including the states where the honest answer is that there is nothing to claim.

Active credit 18
Certificate or limited program 1
No current credit 4
Not in the registry

Illustrative. Status for tax year 2026, read from the rules registry that drives our own engine. Rates, caps and eligibility are set by each state and change; a state page carries the citations. General information, not tax advice.

Every state in the registry

18 with a current credit, 1 running through a certificate program rather than a statutory rate, and 4 where the credit has expired or never existed. Each page renders that state's registry entry and nothing else.

The mechanism

How a federal QRE becomes a state credit

A state credit is not the federal credit wearing a different hat. The same dollars go through four transformations, and each one can change the answer - or eliminate it.

1

Start from the substantiated federal base

Qualified wages, supplies, and contract research that survive the four-part test and the §41(d)(4) exclusions. If a dollar is not a federal QRE, it almost never becomes a state one.
2

Re-scope it to the state

States generally count only research performed within their borders: wages for work done there, contract research performed there. A company with engineers in three states has three different qualified bases, none of which equals the federal one. This is why work location has to be captured with the payroll and project data, not reconstructed at filing time.
3

Apply the state’s own base method

This is where states diverge hardest. Some copy the federal fixed-base-percentage machinery and run it on in-state receipts. Some use a simple average of prior in-state spend - one year, two, three, or four, sometimes halved. One sets the base at the greater of half your current spend or a four-year average. A few skip the increment entirely and pay a flat rate on all qualified spend. Feed the wrong history into the wrong method and you can zero out a real credit or double a small one.
4

Apply the rate, the limits, and the cash character

Then the state’s rate, its program caps and application windows, its liability limitations, and the question that actually matters to a CFO: does this become cash, or a carryforward you may never use? Two of the states below do not even credit an income tax - they credit a franchise or gross-receipts tax instead.

One pipeline, many outlets. The substantiation that supports your federal position carries into every state computation, which is why the numbers reconcile and the workpapers tie out. It also means a weak federal base weakens every state result downstream - the argument for getting documentation right once.

State by state

What actually changes at the state line

Every figure below is rendered from the rules registry for TY2026 - not retyped onto this page - so the marketing table and the study engine cannot drift apart. Where the registry is silent, the cell says so rather than filling the gap.

State R&D credit registry, tax year 2026
State	Credit rate	Base method	Carryforward	Refundable?	Claimed on
ArizonaCurrent creditFiling a 2025-year return now? The 75% partial-refund election is still available for that year - but only on an originally filed return, and carrying forward forfeits it.	24% on the first $2,500,000 of the credit base, then 15% above it	Federal §41(c) base, Arizona expenses and receipts substituted	10 years	Not refundableAn affirmative determination in the registry, carried against the statute cited below.	Form 308 (Form 308-I for individuals)A.R.S. §43-1168 (corporate) / §43-1074.01 (individual), as amended by Ch. 140, Laws 2026 (H.B. 4168)
CaliforniaCurrent creditA usage cap limits how much business credit can be applied in certain years, and conformity and available methods changed for recent years - the year you are filing decides which rules apply.	15%	Federal §41(c) base, California expenses and receipts substituted	Indefinite	Not determined in our registry	FTB 3523Cal. Rev. & Tax Code §23609 (post-SB 711: IRC conformity 1/1/2025; AIRC repealed; CA ASC added; SB 167 $5M credit cap TY2024-26)
ColoradoCurrent creditGeography and pre-certification gate the credit before any arithmetic matters.	3%	The average of the 2 preceding years	Indefinite	Not determined in our registry	DR 1366C.R.S. §39-30-105.5 (Enterprise Zone R&D credit)
ConnecticutCurrent creditCombined R&D credit use is capped as a share of tax, and the two credits have an anti-double-dip rule between them.	20%	The average of the 1 preceding year	15 years	Not determined in our registry	CT-1120 RDC / CT-1120 RCConn. Gen. Stat. §12-217j (20% incremental); §12-217n (tiered non-incremental)
FloridaCurrent creditA short annual application window, target-industry certification, and a statewide cap that has prorated approved claims down sharply. The computed number is a ceiling, not an entitlement.	10%	Defined by Florida statute, not the federal §41(c) formula	5 years	Not determined in our registry	F-1196Fla. Stat. §220.196
GeorgiaCurrent credit	10%	Defined by Georgia statute, not the federal §41(c) formula	5 years	Not determined in our registry	IT-RD (filed with the Georgia return; a copy of federal Form 6765 must be attached)O.C.G.A. §48-7-40.12
IllinoisCurrent credit	6.5%	The average of the 3 preceding years	5 years	Not determined in our registry	Schedule 1299-D35 ILCS 5/201(k)
IndianaCurrent creditA separate alternative method exists and is an affirmative election on the return - not something a calculator picks for you.	15% on the first $1,000,000 of the credit base, then 10% above it	The federal §41 base, applied to state expenses	10 years	Not determined in our registry	Schedule IN-RDCIC 6-3.1-4-2
MarylandCurrent creditCertified by the state out of a capped annual allocation, with a small-business set-aside. Certification comes first; the credit follows.	10%	The federal §41 base, applied to state expenses	7 years	Refundable for a small businessthe registry records a small-business test of $5,000,000 net book value of assets.	Form 500CRMd. Tax-Gen. Code Ann. §10-721
MassachusettsCurrent creditHow much you can use in a year is limited by excise liability - a number that lives on the return, not in the study.	10%	The federal §41 base, applied to state expenses	15 years	Not determined in our registry	Schedule RCM.G.L. c. 63, §38M
MinnesotaCurrent credit	10% on the first $2,000,000 of the credit base, then 4% above it	The federal §41 base, applied to state expenses	15 years	Refundable, subject to limits the registry does not recordThe registry records the credit as refundable without recording the statutory limits on the refund, so the study establishes them rather than the page assuming there are none.	Schedule RDMinn. Stat. §290.068
New JerseyCurrent credit	10%	The federal §41 base, applied to state expenses	7 years	Not determined in our registry	Form 306N.J.S.A. 54:10A-5.24 (federal §41 conformity per P.L. 2018, c.48)
New YorkCertificate program only	No current credit rate	Not applicable	Not applicable	Not applicable	None recorded in the registryNY Tax Law §210-B (Excelsior R&D / Life Sciences - ESD certificate required)
North CarolinaExpired	No current credit rate	Not applicable	Not applicable	Not applicable	None recorded in the registryFormer N.C. Gen. Stat. §105-129.50 et seq. (Article 3F - sunset for TY beginning on/after 1/1/2016)
OhioCurrent creditNot an income-tax credit. Folding it into an income-tax subtotal misstates both numbers.	7%	Defined by Ohio statute, not the federal §41(c) formula	7 years	Not determined in our registry	None recorded in the registryOhio Rev. Code §5751.51 (credit against the commercial activity tax)
OregonExpired	No current credit rate	Not applicable	Not applicable	Not applicable	None recorded in the registryORS 317.152 (expired for TY beginning on/after 1/1/2018)
PennsylvaniaCurrent creditApplication-based and awarded from a capped program, then prorated across approved applicants - the award ratio moves every cycle and is not known when you apply.	10%	Defined by Pennsylvania statute, not the federal §41(c) formula	15 years	Not determined in our registry	REV-54572 P.S. §8701-B et seq. (Article XVII-B; Act 7 of 1997)
South CarolinaCurrent creditApplied last, and capped each year at 50% of the tax liability remaining after every other credit - a first-year credit can be mostly deferred, so plan the carryforward.	5%	No base amount: the rate applies to expenses directly	10 years	Not refundableAn affirmative determination in the registry, carried against the statute cited below.	SC Sch. TC-18 (credit code 018)S.C. Code Ann. §12-6-3415
TexasCurrent creditPrior-period claims follow the prior regime. A contract with a Texas higher-education institution changes the rate, and a missing preceding period changes the whole method.	8.722%	Defined by Texas statute, not the federal §41(c) formula	20 years	Partially refundablethe registry records refundability only for an entity with no tax due.	Form 05-178Tex. Tax Code ch. 171 subch. T (S.B. 2206; reports due on/after 1/1/2026)
UtahCurrent credit	7.5%	Federal §41(c) base, Utah expenses and receipts substituted, for the 5% components	Split: no carryforward for the component computed at 7.5%, 14 years for the component computed at 5%.	Not refundableAn affirmative determination in the registry, carried against the statute cited below.	Credit code 12 (TC-40A Part 4 / TC-20 Sch. A - no separate form)Utah Code Ann. §59-7-612 / §59-10-1012
VirginiaExpired	No current credit rate	Not applicable	Not applicable	Not applicable	None recorded in the registryVa. Code Ann. §58.1-439.12:08 / :11 (expired for TY beginning on/after 1/1/2025; HB 1969 (2025) extension failed)
WashingtonExpired	No current credit rate	Not applicable	Not applicable	Not applicable	None recorded in the registryRCW 82.04.4452 (expired 1/1/2015 - no current credit)
WisconsinCurrent creditThe elevated rates are activity-based (specific research subjects), never size-based. Applying one because a company is small overstates the credit.	5.75%	50% of the average of the 3 preceding years	15 years	Not determined in our registry	Schedule RWis. Stat. §71.07(4k)

Rendered from the rules registry Ricerca's platform computes from - 23 states, tax years 2025 and 2026, exported September 10, 2026. State rules change; the study applies the law for the tax year claimed. "Not determined in our registry" is an honest unknown, not a "no": the registry treats an unverified nonrefundable as undetermined rather than asserting it, and the study establishes the position.

Several states attach conditions no table cell can hold; the per-state pages carry the registry's own notes, caps, and citations in full. Nothing here is a determination for your facts, and state legislatures revisit these provisions constantly. We re-verify each state's current-year status before a study is issued.

The unpopular answer

Sometimes the right answer is “your state doesn’t have one.”

A credit that does not exist is the most expensive thing anyone can put in your file. It survives review, it survives filing, and then it does not survive an examination.

Our engine will not compute a state credit for a state whose rules have not been researched, cited, and versioned - and it will not compute one for a state whose credit has sunset. Where a state’s refundability has never been established, the deliverable says not determined rather than asserting a position nobody verified. That posture costs us the occasional flattering number. It is the same posture behind Audit Protection.

New York

No general statewide R&D credit. New York’s R&D benefits run through Empire State Development certificate programs - Excelsior and the life-sciences credit - which have to be awarded before anything can be claimed on a return.
Virginia

Both research-and-development expenses credits expired for tax years beginning on or after January 1, 2025, and the 2025 extension effort did not pass. Earlier open years can still be in scope; current years should not be computing a Virginia credit.
North Carolina

The Article 3F credit sunset for tax years beginning on or after January 1, 2016.
Oregon

The credit expired for tax years beginning on or after January 1, 2018.
Washington

The business-and-occupation tax R&D credit expired in 2015, and Washington has no corporate income tax to credit against.

Cash now or cash later

Refundable, transferable, or just deferred

“We qualify for a state credit” and “we will see money this year” are different sentences. Four outcomes cover almost every state.

Nonrefundable - it waits for liability

The most common outcome. The credit reduces state tax and no further; anything you cannot use carries forward, for anywhere from five years to indefinitely. Real money for a profitable filer, and a promissory note for a company still in losses.

Refundable - but conditionally

Several states will pay out all or part of an unused credit - conditioned on company size, on having no tax due, on a certification, or on an allocation that can run out. Our deliverables name the condition instead of printing an unqualified “refundable,” because a taxpayer told to expect cash the state may never send has been given the wrong number.

Exchangeable or transferable

A narrow but valuable category: a company that cannot use a credit monetizes it another way. Connecticut lets qualifying small companies exchange unused credit for cash at a statutory percentage, and a small number of states run certificated programs that let qualifying early-stage companies transfer credits to another taxpayer. All of these are program-specific and application-gated - we confirm the current-year route rather than assume it survived the last session.

Limited, not lost

Separate from refundability: several states cap how much credit you may use in a year - as a share of liability, or as a flat ceiling across all business credits. That is a deferral, not a forfeiture; the excess carries forward. It matters because a study that quietly truncated the credit to the usable amount would understate what you own.

Application windows are the quiet killer. Several of the best state credits are not claimed on the return at all - they are applied for, certified, and then allocated out of a capped pot, sometimes months before the return is due and sometimes inside a window that is open for a week. Missing the window does not reduce the credit; it removes it. We surface the gate before it closes rather than discovering it at filing.

Multi-state companies

Three states, three bases, three different answers.

Once your engineers sit in more than one place, the state computation stops being a bolt-on. Qualified research is apportioned by where the work happened, each state’s rules are applied where you have nexus, and the prior-year history each state measures against has to be in that state’s scope - not the company-wide federal series.

Where a state-scope history is not on record, we apportion the federal series to that state’s share so the base and the numerator are in the same units - and mark it as the proxy it is rather than passing it off as history.
Franchise-tax and gross-receipts-tax credits are kept out of any income-tax subtotal, so the summary your preparer reads is not quietly adding unlike things together.
Where a state needs inputs the study does not hold - in-state receipts, a fixed-base percentage, a liability figure - we ask for them, and until they arrive the result carries an explicit readiness flag instead of a confident guess.

See how a study works Inside the platform

What that means on your return

One substantiated federal base, apportioned by where the work happened, run through each state's own method - and reported so the income-tax credits, the franchise-tax credits, and the gross-receipts-tax credits stay in separate columns instead of one misleading subtotal.

Where a state needs an input the study does not hold, the result carries a readiness flag rather than a confident guess.

Next: the federal base every state computation starts from, and the method choice behind it.

Qualified research expenses Regular credit vs. ASC

State R&D credit questions

Do you actually calculate the state credit, or just the federal one?

Both. Every Ricerca study computes the federal IRC §41 credit and the applicable state R&D credit(s) from the same substantiated qualified-research base, so your state benefit is captured in the study rather than deferred to “we’ll look at that later.”

Is the state credit computed on the same expenses as the federal credit?

It starts there and then narrows. States generally build on the federal definition of qualified research but measure it in their own scope - wages for work performed in the state, contract research performed in the state, supplies consumed there. That is why the study captures where work happened at the source, not as an afterthought. See qualified research expenses for how the federal base is built.

Which states have an R&D credit?

Most states with a corporate income or franchise tax offer some form of R&D credit or incentive, and the specifics - base method, rate, caps, carryforward, refundability, apportionment - differ in every one. Our rules registry carries researched, cited rules for the states listed on this page, including the ones where the answer is that no current credit exists. We do not extrapolate one state’s rules onto another.

How much can a state R&D credit add?

It varies widely by state and by taxpayer, and the honest answer is that a rate alone will not tell you. Two companies with identical federal credits can get very different state results because of base method, in-state scope, program caps, and liability limits. We compute your state benefit in the study rather than quoting a number here.

Are state credits refundable?

Some are, and almost always conditionally - on company size, on having no tax due, on a certification, or on an allocation that runs out. Where a state’s credit can produce cash, we say what the refund is conditioned on. Where nobody has established the position for a state, our engine reports it as not determined rather than printing an assumption on a signed deliverable.

Can an unused state credit be sold or transferred?

In a few places, yes - in one form or another. Connecticut, for example, lets qualifying small companies exchange unused credit for cash at a statutory percentage, and a small number of states run certificated programs that let qualifying early-stage companies transfer unused credits to another taxpayer. These paths are program-specific, application-gated, and change; we confirm the current-year route rather than assume one exists.

What if we operate in more than one state?

We apportion qualified research by state and apply each state’s rules where you have nexus. Where a state measures its base against its own prior-year history, we use that state-scope history when it is on record - and when it is not, we apportion the federal series to the state’s share so the base and the numerator are in the same units, and flag it as the proxy it is.

Does claiming a state credit change our federal position?

Not the federal credit itself. But a state credit reduces state tax, and state tax is generally deductible federally, so the two interact at the margin. It is a modeling point for your preparer, not a reason to leave a state credit unclaimed.

Do states follow §174A?

Not uniformly. Some states conform to the federal treatment of research costs automatically; others sit on fixed conformity dates and can still require capitalization after the federal rules changed. We check the states you file in as part of the study - see the §174A guide for the federal picture.

Our state has no R&D credit. Is that the end of it?

For the R&D credit specifically, sometimes yes - and we would rather tell you that than compute something you cannot claim. Your federal §41 credit is unaffected, and if you are an early-stage company the payroll-tax offset may be the cash path that matters more than any state result.

Questions about a specific state? Email [email protected] - We typically reply within one business day.

Capture the state credit, not just the federal one

Tell us where your engineers actually sit. We’ll come back with the states where your work has nexus, what each is likely to be worth, how each one pays out - refund, exchange, or carryforward - and a price for the study.

[email protected] We typically reply within one business day.

Get your free credit estimate Talk to our team