Georgia R&D Tax Credit Filing Instructions

To claim the Research and Development (R&D) tax credit in Georgia, a business must demonstrate qualified research expenses (QREs) conducted within the state that exceed a calculated base amount. Eligibility generally requires the business to also claim the federal R&D credit under Internal Revenue Code Section 41. The Georgia credit is typically 10% of the QREs that surpass this base amount. Once calculated, the credit can be used to offset up to 50% of the business’s net Georgia income tax liability, after all other credits have been applied. Any remaining unused credit can be carried forward for up to ten years or, with proper election, applied against state payroll withholding taxes. To make the state R&D tax credit claim, businesses must file Georgia Form IT-RD, the “Research Tax Credit” form, along with their Georgia corporate income tax return. It is also required to attach Federal Form 6765. If electing to apply the credit against payroll withholding, Form IT-WH, “Notice of Intention to Claim Withholding Benefit,” must be filed electronically within 30 days after the filing of a timely Georgia income tax return.