Vermont · research and development · VT-RD-001
Research and Development Tax Credit
Publication revised September 24, 2026. Sourcebook page 264.
Credit amount / calculation
For 2026: 27% of the federal research credit attributable to Vermont. Act 164 increases this to 75% for tax years beginning January 1, 2027 or later.
Business fit and eligible activity
Vermont companies receiving the federal research credit can claim a state credit. Qualified research activity. Ordinary production, routine quality control and an equipment purchase alone do not qualify.
Illustrative business benefit
A $20,000 federal research credit attributable to Vermont gives $5,400 at the 2026 rate of 27%. For a tax year beginning in 2027, the enacted 75% rate would give $15,000 on the same assumed federal credit base.
Timing / first action
Tax-year claim: document the eligible expense, hire or placed-in-service date and meet any separate certification deadline. Use the rate for the beginning date of the tax year; the enacted increase is not effective for 2026 tax years.
Official sources
Related programs
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.