Infographic: Everything You Need To Know About Arizona’s Refundable Research and Development (R&D) Tax Credit

Arizona offers both refundable and non-refundable credits in addition to the Federal R&D tax program:

  •  The 2011 through 2022 R&D tax credit is equal to 24% of the first $2.5 million in qualifying expenses plus 15% of the qualifying expenses in excess of $2.5 million.
  • For 2023 and thereafter, the tax credit rates will be 20% of the first $2.5 million in qualifying expenses plus 11% of the qualifying expenses in excess of $2.5 million.
  • Unused credits can be carried forward up to 15 years.
  • In order to qualify for the refundable portion of the tax credit, a Company must qualify for the regular tax credit and employ less than 150 full-time employees.
  • The refundable amount is 75% of the excess of the allowable credit that exceeds the taxpayer’s tax liability. Any excess amounts of credits are waived.
  • Arizona has capped the refundable amounts to $5 million in any calendar year.

We know that this program can seem complicated for first-time claimers so we attempted to simplify it into an easy-to-read infographic.

(Click infographic to open in a new tab)

Arizona R&D Tax Credit Infographic

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