Connecticut · research and development · CT-RE-001
Research and Experimental Expenditures Credit
Publication revised September 24, 2026. Sourcebook page 70.
Credit amount / calculation
20% of Connecticut research and experimental expenditures above the preceding income year.
Business fit and eligible activity
Separate credit for increases in qualifying research and experimental spending. Qualified research activity. Ordinary production, routine quality control and an equipment purchase alone do not qualify.
Eligibility and practical use
For forest products, research credits usually live on the mill floor rather than in a laboratory. Scanner settings, drying schedules, process-control changes, product testing, and equipment modifications can matter when the work is experimental rather than routine. A logging company has a narrower path, but equipment-control, software, or process-development work can sometimes qualify if it satisfies the same technical tests.
Illustrative business benefit
Qualified expenditures of $300,000 this year versus $200,000 last year produce ($300,000 - $200,000) x 20% = $20,000. At the standard 65% small-business exchange rate, an eligible taxpayer with no tax liability could receive $13,000 instead of carrying that credit forward.
Timing / first action
Tax-year claim: document the eligible expense, hire or placed-in-service date and meet any separate certification deadline. Identify the technical uncertainty and start contemporaneous project records before trying to calculate the credit.
Official sources
- Connecticut Department of Revenue Services - Incremental Research (ct.gov)
- Connecticut Department of Revenue Services - Fixed Capital Investment (ct.gov)
- Connecticut Department of Revenue Services - Human Capital (ct.gov)
- Connecticut Department of Revenue Services - Machinery and official source (ct.gov)
- United States Department of Labor - State Apprenticeship Tax Credits (ct.gov)
- Connecticut Department of Revenue Services - Nonincremental (apprenticeship.gov)
- Connecticut Department of Revenue Services - Incremental Research (apprenticeship.gov)
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