Indiana · research and development · IN-RD-001
Research Expense Tax Credit
Publication revised September 24, 2026. Sourcebook page 109.
Credit amount / calculation
Regular method: 15% of the first $1 million of qualified research expenses above the base; 10% of the excess above $1 million.
Business fit and eligible activity
Qualified Indiana research can generate a state credit for manufacturers. 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
Assume a mill has $1.5 million of qualified research expenditures above its properly calculated base. The regular-method credit is $1 million x 15% + $500,000 x 10% = $200,000.
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
- Indiana Department of Revenue - Research Expense Credit (in.gov)
- Indiana EDC - Incentives (in.gov)
- Indiana Department of Revenue - Research Expense Credit (opportunityiowa.gov)
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