Florida R&D Tax Credit

Florida Research and Development Tax Credit Summary

Florida offers a Research and Development (R&D) Tax Credit for qualified activities within the state, as long as the corporation qualifies for and claims the federal R&D credit under IRC §41. Only corporations in the following targeted industries may claim the Florida research credit:

• • Life Sciences
  • Information Technology
  • Aviation/Aerospace
  • Homeland Security/Defense
  • Cloud Information Technology
  • Marine Sciences
  • Materials Science
  • Nanotechnology Industries
  • Manufacturing

• Credit is limited to C Corporations only.
• "Qualified research expenses" (QREs) have the same meaning as in IRC § 41, except that such expenses must be for research conducted within Florida.
• The Florida R&D credit is equal to 10% of the QREs in Florida that exceed a base amount. The base amount is the average of the QREs in Florida for the 4 tax years before the tax year for which the credit is being calculated.
• For a corporation that has not been in existence for at least 4 years before it claims the credit, the credit is reduced by 25% for each year that the corporation did not exist.
• A company must claim a federal credit in order to claim a Florida credit.
• The credit is limited to 50% of a corporation’s net income tax liability after all other credits have been applied in the priority order set by Florida law.
• The annual credit cap for all taxpayers is $9 million. If the state credit cap is reached, the credits are allocated to each qualified applicant on a prorated basis.
• To claim the Florida research credit, corporations must apply for an allocation of the Florida R&D credit. The application form must be completed and submitted electronically to the Florida Department of Revenue (DOR) between March 20 and March 26 each calendar year the credit is available. The application must include a letter from the Department of Commerce (DOC) certifying that the corporation is an eligible qualified target industry business.
• Excess credits may be carried forward up to 5 years.
• A company must be certified by the Department of Economic Opportunity as a qualified target business industry, including:
  • Life Sciences
  • Information Technology
  • Aviation/Aerospace
  • Homeland Security/Defense
  • Emerging Technologies

  • Cloud Information Technology
  • Marine Sciences
  • Materials Science
  •  Nanotechnology Industries
  • Manufacturing