California R&D Tax Credit Summary

R&D Tax Credit Available:

Yes


Eligible Entities:

C-Corporation, S-Corporations, LLCs, Partnerships


Deadline for Tax Filing:

Due with California Tax Return


Data Required to Compute Credit:

  • Claim Period Qualified R&D Expenses (QREs)
  • Gross Receipts for Prior 4 Years

Credit Carryforward:

Yes - Indefinitely


R&D Credit Summary:

The R&D tax credit equals:

  • 15% of the excess of California qualified research expenses for the taxable year over the base period research expenses.
  • 24% of basic research expenses for university-based research for the taxable year.

Special Notes:

Taxpayers may elect the alternative incremental credit in which taxpayers are assigned a smaller three-tiered fixed-base percentage and a reduced three-tiered credit rate (1.49%, 1.98%, and 2.48%).

Research Tax Credit
Important Links and Forms

CA FTB
CA Form 3523
Form 3523 Instructions
CA R&D FAQs

Contact Us for a No-Cost Assessment of your Federal and State Research Credit Estimate

Learn More About R&D Tax Credits