Connecticut · Equipment · CT-ME-001
Machinery and Equipment Expenditure Credit
Publication revised September 24, 2026. Sourcebook page 67.
Credit amount / calculation
10% of the increase in eligible machinery and equipment spending for employers with no more than 250 Connecticut employees; 5% for 251-800 employees.
Business fit and eligible activity
Manufacturers can obtain a credit tied to qualifying machinery and equipment expenditures. Qualified investment or approved project activity; confirm eligible property, location and taxpayer type.
Eligibility and practical use
Use qualifying machinery costs and the preceding year comparison. Transportation property, separately purchased software and construction equipment are excluded. Do not assume electrical work or installation is part of the credit base.
Illustrative business benefit
A 100-employee mill spends $700,000 on eligible machinery this year and $200,000 last year. The incremental credit is ($700,000 - $200,000) x 10% = $50,000, not 10% of the entire purchase.
Timing / first action
Tax-year claim: document the eligible expense, hire or placed-in-service date and meet any separate certification deadline. Get a written answer on which property is qualified - especially buildings, installation, software, used equipment, vehicles, and mobile machinery.
Official sources
Related programs
Fixed Capital Investment Credit
5% of eligible fixed-capital investment
Credit for qualifying fixed capital acquired by a Connecticut business.
Human Capital Investment Credit
10% of eligible training
Qualified training and human-capital spending can earn a credit.
Manufacturing Apprenticeship Training Credit
Up to
Manufacturers employing qualified registered apprentices can earn a credit.
Clean Electricity Investment Credit (Internal Revenue Code §48E)
Generally
Potentially relevant when a forest-products facility owns qualifying zero-emission generation or energy-storage property.
Clean Electricity Production Credit (Internal Revenue Code §45Y)
Production-based
Alternative to the investment credit for owners/operators of qualifying clean-electricity facilities; potentially relevant to qualifying on-site generation.
Clean Fuel Production Credit (Internal Revenue Code §45Z)
Per-gallon or gallon-equivalent credit based on the
Potentially relevant only if a forest-products business actually produces qualifying transportation fuel.