Utah · research and development · UT-RD-001
Research Activities Tax Credit
Publication revised September 24, 2026. Sourcebook page 262.
Credit amount / calculation
Current statute includes 5% incremental research/basic-research components plus 7.5% of current Utah qualified research expenses.
Business fit and eligible activity
Qualified Utah research can produce multiple nonrefundable credit components. 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 $300,000 of current Utah qualified research expenses and $200,000 of qualifying incremental expenses under the statutory base calculation. The 7.5% current-expense component is $22,500 and the 5% incremental component is $10,000, for $32,500 before limitations; qualifying basic-research payments are a separate component.
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
- le.utah.gov — Utah Code Section 59-10-1012 (le.utah.gov)
Related programs
Economic Development Tax Increment Financing Credits
up to
Substantial manufacturing expansions creating high-wage jobs can negotiate refundable post-performance credits; rural projects can receive higher percentages.
Recycling Market Development Zone Tax Credit
Machinery credit
Potentially useful to a wood-residual business operating in a designated zone and making products from qualifying recycled/post-consumer material.
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.