Vermont Research and Development Tax Credit Summary

The Vermont R&D Tax Credit provides a tax credit for increasing qualifying research activities. Vermont leverages off of the federal section 41 rules in determining qualified research expenditures and calculating the state credit.

  • Applicable Vermont code section is 32 V.S.A Section 5930ii
  • The credit applies to qualified expenditures that occurred in Vermont
  • The credit is equal to 27% of the federal credit for expenditures made in Vermont
  • Vermont allows a 10 year carry forward period for any unused R&D tax credits

Vermont R&D Tax Credit Case Study

A manufacturing company in Vermont conducted a look back study for the prior two years for the R&D credit. This project involved a multi-year study covering the tax years 2012 through 2014. The Company qualified for the federal R&D Tax Credits of $278,930 and an additional $75,311 in Vermont state R&D Tax Credits.

  
FEDERAL
 
VERMONT
Year
Total QREs
Credit
Total QREs
Credit
2014
$1,002,170
$100,217
$1,002,170
$27,059
2013
927,935
92,793
927,935
25,054
2012
859,199
85,920
859,199
23,198
      
Total$2,789,304$278,930$2,789,304$75,311