Bill > S354

This bill reenacts and modifies the Research and Development (R&D) Tax Credit in North Carolina, extending its sunset date to January 1, 2040 and making several key changes. The bill redefines a "related person" to align with federal tax code definitions and introduces new eligibility standards for businesses claiming the tax credit. Businesses must now meet specific requirements including wage standards (paying above a certain average weekly wage), providing health insurance for full-time employees, having no recent serious environmental violations, maintaining safe workplace practices, and having no outstanding tax debts. The tax credit can be applied against franchise or income taxes, with a reduced cap of 15% (down from 50%) of the tax liability. The credit percentages vary based on business size and location, ranging from 3.25% for small businesses and low-tier research to 20% for university research expenses and 35% for research in Eco-Industrial Parks. For general research expenses, the credit ranges from 1.25% to 3.25% depending on the total amount of qualified expenses. The bill also requires detailed reporting on these tax credits and maintains provisions for businesses to carry forward unused credits for up to 15 years.

https://www.ncleg.gov/BillLookUp/2025/S354