Connecticut · research and development · CT-RD-001
Research and Development Credit
Publication revised September 24, 2026. Sourcebook page 69.
Credit amount / calculation
Qualified small businesses generally calculate a 6% tentative credit on eligible Connecticut research expenses; other companies use a tiered schedule. Annual use is restricted.
Business fit and eligible activity
Qualified Connecticut research and development can generate a corporate credit. Qualified research activity. Ordinary production, routine quality control and an equipment purchase alone do not qualify.
Eligibility and practical use
The gross-income test for the 6% rate is $100 million, while the general exchange test uses $70 million. Coordinate this credit with the separate incremental research credit to avoid double counting.
Illustrative business benefit
$300,000 of accepted expenses at 6% gives an $18,000 tentative credit. The one-third annual-use rule would limit that year's portion to $6,000 before further tax-liability limits. A qualifying no-tax-liability small business may instead elect a discounted exchange.
Timing / first action
Tax-year claim: document the eligible expense, hire or placed-in-service date and meet any separate certification deadline. Apply the proper small-business test, eligible expense definition and annual-use calculation.
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.
Machinery and Equipment Expenditure Credit
10% of the increase in eligible machinery
Manufacturers can obtain a credit tied to qualifying machinery and equipment expenditures.
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.
Credit for Increasing Research Activities (Internal Revenue Code §41)
Regular research-credit method
A sawmill, secondary manufacturer or biomass business can qualify when it performs genuine technological experimentation to improve a product or process.
Rehabilitation Credit (Internal Revenue Code §47)
Generally
A forest-products company rehabilitating a certified historic mill or industrial building for income-producing use may qualify.