§ 105-129.55. (See notes) Credit for North Carolina research and development. - North Carolina Statutes

§ 105‑129.55.  (Seenotes) Credit for North Carolina research and development.

(a)        Qualified NorthCarolina Research Expenses. – A taxpayer that has qualified North Carolinaresearch expenses for the taxable year is allowed a credit equal to apercentage of the expenses, determined as provided in this subsection. Only onecredit is allowed under this subsection with respect to the same expenses. Ifmore than one subdivision of this subsection applies to the same expenses, thenthe credit is equal to the higher percentage, not both percentages combined. Ifpart of the taxpayer's qualified North Carolina research expenses qualifiesunder subdivision (2) of this subsection and the remainder qualifies undersubdivision (3) of this subsection, the applicable percentages apply separatelyto each part of the expenses.

(1)        Small business. – Ifthe taxpayer was a small business as of the last day of the taxable year, theapplicable percentage is three and one‑quarter percent (3.25%).

(2)        Low‑tierresearch. – For expenses with respect to research performed in a developmenttier one area, the applicable percentage is three and one‑quarter percent(3.25%).

(3)        Other research. – Forexpenses not covered under subdivision (1) or (2) of this subsection, thepercentages provided in the table below apply to the taxpayer's qualified NorthCarolina research expenses during the taxable year at the following levels:

ExpensesOver                 Up To                              Rate

-0-                                  $50million                     1.25%

$50million                           $200 million                     2.25%

$200million                             –                                3.25%

(b)        North CarolinaUniversity Research Expenses. – A taxpayer that has North Carolina universityresearch expenses for the taxable year is allowed a credit equal to twentypercent (20%) of the expenses. (2004‑124, s. 32D.2; 2006‑252, s. 2.1;2007‑323, s. 31.8(a).)