Illinois R&D Tax Credit Explained for Businesses

Illinois and the R&D Tax Credit

The Illinois R&D credit is generated from qualified research activities (QRAs) performed within the state. Qualifying activities are defined in Section 41 of the Internal Revenue Code as “a new or improved function, performance, or reliability or quality.”

Process improvement activities include:

Identifying uncertainty concerning the development or improvement of a business component;
Identifying one or more alternatives intended to eliminate that uncertainty; and
Identifying and conducting a process of evaluating the alternatives (e.g., through modeling, simulation, or a systematic trial-and-error methodology).

The R&D Tax Credit is a credit that is available across various industries, such as:

Agriculture
Automotive
Aviation
Biotechnology
Engineering
Farming
Food and Beverage
Logistics
Manufacturing
Oil and Gas
Software
Transportation

State Credit Name: The Illinois Research and Development Credit (1299-D, lines 24-33)

Expiration Date: December 31, 2021

Who Can Apply? Corporations and Flow-through entities

Credit Carry Forward: Unused credit can be carried forward up to 5 years.

About the Credit: A non-refundable credit of 6.5% of the QRE’s for qualifying research activities performed in Illinois.

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Are you eligible?

Why choose us?

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Swanson Reed is one of the only companies in the United States to exclusively focus on R&D tax credit preparation. Swanson Reed’s office location at 318 West Adams Street, Chicago, Illinois provides R&D tax credit consulting and advisory services to Chicago, Aurora, Rockford, Joliet, Naperville, Springfield, Peoria, Elgin, Waukegan, Champaign, Bloomington, Decatur, Evanston, Des Plaines, Berwyn, Wheaton, Carbondale, Mount Prospect, Oak Lawn and Skokie.

If you have any questions or need further assistance, please call or email our local Illinois Partner on (312) 380-0467.
Feel free to book a quick teleconference with one of our Illinois R&D tax credit specialists at a time that is convenient for you. Click here for more information about R&D tax credit management and implementation.

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