New Hampshire R&D Tax Credit Summary
The New Hampshire R&D Tax Credit offers taxpayers a permanent research and development credit against the business profits and business enterprise taxes. The credit is for qualified manufacturing research and development expenditures made or incurred within New Hampshire during the fiscal year. The expenditures are defined as wages provided that the wages qualify for the federal credit under IRC §41.
In New Hampshire, a Research & Development tax credit is allowed for qualified manufacturing R&D expenditures made or incurred during the fiscal year, however: The aggregate of tax credits issued to the taxpayers must not exceed
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$1 million for any fiscal year prior to May 20, 2013;
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$2 million after May 20, 2013 and before July 1, 2017; and
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$7 million starting on July 1, 2017
In the event that the aggregate amount of credit applied for, in any given fiscal year, exceeds the aggregate period's tax credit cap, all credits for that year will be allocated and reduced proportionately. The credit is first applied against the business profits tax, and any remaining amount may be applied against the business enterprise tax.
The amount of the credit will be the LESSER of:
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(a) 10% of the excess of the qualified manufacturing research and development expenses for the tax year over the base amount;
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(b) the proportional share of the maximum aggregate credit amount allowed in that tax period (see above); or
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(c) $50,000. The New Hampshire credit can not exceed $50,000
Qualified manufacturing research and development expenditures means any wages paid or incurred to an employee of the business organization for services rendered by this employee within New Hampshire provided that:
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The wages will be treated as wages for qualified research expenses under IRC §41(b)
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The services are undertaken to discover information that constitutes qualified research and development of a new or improved manufacturing processor business component of the business organization
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The wages qualify and are reported as a credit by the business organization under IRC §41
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The wages are reported by the business organization in the enterprise value tax base
Eligible Entities: C-Corporations, S-Corporations, LLCs, Partnerships
Deadline for Tax Filing: Application due by 6/30
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Taxpayers can apply for the tax credit on Form DP-165, Research and Development Tax Credit Application, which must be accompanied by information or records required by the Commissioner.
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Applications must be postmarked no later than June 30 following the tax year during which the research and development occurred and a determination on the final amount of the credit awarded to each taxpayer claiming the credit will be made no later than September 30 of each year.
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The application should be submitted along with Federal Form 6765.
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Data Required to Compute Credit:
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Claim Period Qualified R&D Federal Wages
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Claim Period Qualified R&D NH Wages
Credit Carryforward: 5 Years
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The unused portion of the credit may be carried forward for 5 years.
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Any unused research and development tax credit not applied against the business profits tax liability can be used to offset the taxpayer’s business enterprise tax liability
Refundable/Transferable Tax Credit: No
Important Links and Forms: