Glossary Term	Definition
Louisiana Revised Statute (RS) 47:6015	The primary state legislation legally governing the Louisiana Research and Development Tax Credit program.
Louisiana Economic Development (LED)	The state agency responsible for evaluating, administering, and certifying Louisiana R&D tax credit applications.
Louisiana Department of Revenue (LDR/DOR)	The official agency handling the processing and application of claimed tax credits against state liabilities.
Qualified Research Expenditure (QRE)	Specific financial costs incurred for eligible research activities that meet strict federal and state guidelines.
Louisiana Qualified Research Expenditure (LQRE)	Eligible research costs physically incurred within the state borders of Louisiana for tax credit purposes.
Internal Revenue Code (IRC) Section 41	The federal tax code outlining the rules, definitions, and calculations for claiming research tax credits.
IRC Section 41(d) (Qualified Research Definition)	The federal statutory definition establishing the four-part test required to qualify an activity as eligible.
Income and Corporation Franchise Taxes	The specific Louisiana state taxes against which the R&D tax credit can be directly applied.
Credit Application Fee (0.5% of requested credit)	A mandatory, non-refundable processing fee paid to LED, calculated as 0.5% of the requested credit.
Minimum Application Fee ($500)	The lowest allowable processing fee a taxpayer must pay to LED when submitting an application.
Maximum Application Fee ($15,000)	The maximum capped fee amount a taxpayer will pay when submitting a large credit application.
Pre-Approval/Certification Requirement	The mandatory process of securing official approval from LED before claiming credits on tax returns.
Certification by LED (Prior to Claiming)	Official, written verification granted by Louisiana Economic Development required prior to taxpayer utilization of credits.
Tax Credit Incentive	A direct, dollar-for-dollar reduction in state tax liability designed to encourage local research and innovation.
Tax Credit Registry (for Transferred Credits)	The official state database actively tracking the ownership, sale, and transfer of sellable tax credits.
Form R-620 (Research and Development Tax Credit Claim Form)	The standard LDR documentation form used by taxpayers to officially claim their approved R&D credits.
Form R-6135 (SBIR/STTR Transfer Notification Form)	The state form legally required to notify LDR when successfully transferring or selling SBIR/STTR credits.
Base Amount (for Credit Calculation)	A historically determined threshold of spending that current year research expenditures must exceed for eligibility.
Average LQRE (3 Previous Tax Years)	The mathematical average of Louisiana-based research spending over the three prior years to establish baselines.
Small Business Credit Rate (Up to 30%)	The significantly enhanced tax credit percentage available specifically to Louisiana businesses with fewer workforce employees.
Entity Employing Less Than 50 Persons	A designated small business classification qualifying for the absolute highest R&D tax credit rate available.
Entity Employing 50 to 99 Persons (Credit Rate)	A mid-sized business structural classification eligible for a moderately tiered percentage of the R&D credit.
Entity Employing 100 or More Persons (Credit Rate)	A large business structural classification eligible for the lowest tiered percentage of the Louisiana credit.
Full-Time Equivalent (FTE) Employees (Louisiana-Based)	The standardized measurement of the workforce physically located in Louisiana used to determine entity size.
Credit Carryforward Period (5 Years or 10 Years, varies)	The allowable future timeframe during which generated but unused tax credits can offset tax liabilities.
Nonrefundable Credit	A specific tax credit that only reduces liability to zero, without providing any excess cash.
Taxable Year	The defined 12-month accounting period consistently used by the taxpayer to calculate and report expenditures.
Wages for Qualified Services (in Louisiana)	Compensation directly paid to employees physically performing, supervising, or supporting eligible R&D activities within Louisiana.
Direct Supervision (of Qualified Research)	First-line operational management directly overseeing personnel who are actively performing technical research and development tasks.
Direct Support (of Qualified Research)	Essential supplementary activities, such as custom machining or specific cleaning, facilitating primary R&D research processes.
Direct Performance (of Qualified Research)	The actual hands-on, physical execution of technical scientific tasks and empirical experiments for an R&D project.
General or Administrative Wages (Exclusion)	Routine daily business operating expenses and human resources wages that never qualify for R&D tax credits.
Cost of Supplies (in Louisiana)	Expenditures for tangible personal property exclusively used and consumed during the research process within Louisiana.
Supplies Consumed (in Qualified Research)	Raw materials actively destroyed, entirely used up, or fundamentally transformed during testing and prototype development.
Contract Research Expenses (65% Limitation)	Payments made to specialized third-party contractors, legally limited to 65% eligibility for tax credit calculations.
Written Agreement (for Contract Research)	A mandatory, signed legal contract detailing the exact scope, rights, and financial risks of outsourced research.
Taxpayer Bears Financial Risk (Contract Research)	The strict regulatory requirement that the paying taxpayer bears the economic loss if research ultimately fails.
Basic Research Payments (Qualified Organization)	Monetary expenditures made to universities or scientific institutions for fundamental research completely lacking immediate commercial objectives.
Federal Form 6765 (Required Documentation)	The standard IRS tax form used to claim federal R&D credits, serving as mandatory state documentation.
Small Business Innovation Research (SBIR) Grant	A highly competitive federal grant program funding domestic small businesses to actively engage in advanced R&D.
Small Business Technology Transfer (STTR) Grant	A federal grant program requiring small businesses to formally collaborate with non-profit research institutions for R&D.
SBIR/STTR Tax Credit (30% of Award)	A special Louisiana incentive offering a 30% state tax credit based on received federal grant funds.
Transferable Credit (SBIR/STTR Credit Only)	A specialized type of tax credit that can legally be sold to entirely different taxpayers for cash.
Aggregate Cap ($12 Million Statewide – Post-2025)	The legally mandated maximum total amount of Louisiana R&D tax credits that can be awarded annually.
Expenditure Verification Report (CPA/Tax Attorney)	A mandatory, independent professional audit report verifying the complete accuracy and eligibility of claimed R&D expenditures.
Control Group or Affiliates (Employee Count)	Legally related business entities whose employee counts must be aggregated to correctly determine the credit tier.
Business Component (Federal Four-Part Test)	The specific product, technological process, software, technique, formula, or physical invention being developed or improved upon.
Technological in Nature (Federal Four-Part Test)	The strict requirement that all eligible research must fundamentally rely on principles of physical or computer sciences.
Narrative Describing R&D Activities (Required Documentation)	A detailed, comprehensive written explanation required to scientifically justify how the performed activities meet all R&D qualifications.