Tax Credit for Research Activities in Utah (code 12)

(UC §59-10-1012)

A nonrefundable credit is allowed for certain Utah research expenses.

The credit is 5 percent of:

Qualified expenses for increasing Utah research activities above a base amount in the taxable year,
Certain payments to a qualified organization increasing basic Utah research above a base amount in the taxable year, and
Qualified research expenses for the taxable year beginning 2008.

Any credit under 1 or 2 above more than the tax owed may be carried forward for the next 14 taxable years. Any credit under 3 above may not be carried forward.

There is no form for this credit. Keep all related documents with your records.

2007 Credit: This credit could formerly be claimed in the tax year immediately after the year you qualified for the credit. Consequently, if you had qualified research expenses in 2007, you may deduct that credit in 2008 along with any 2008 credit.

Tax Credit for Machinery and Equipment Used to Conduct Research (code 13)

(UC §59-10-1013)

A nonrefundable credit is allowed for certain investments in research machinery and equipment.

The credit is 6 percent of the purchase price of machinery, equipment, or both:

Used primarily to conduct qualified Utah research for at least 12 consecutive months, or
Donated to a qualified organization and used primarily to conduct basic Utah research for at least 12 consecutive months.

Any credit more than the tax owed may be carried forward for the next 14 taxable years.

The credit is not allowed if machinery and equipment are used for less than 12 consecutive months to primarily conduct qualified research. File an amended return for the year the credit was claimed, removing the credit from the return and paying any increase in tax. See amended return instructions on page 4 of the 2008 Individual Income Tax Filing Instructions.

There is no form for this credit. Keep all related documents with your records.