State Program
Kentucky Qualified Research Facility Tax Credit
A Kentucky incentive for constructing, remodeling, equipping, or expanding facilities used for qualified research.
Program Overview
Kentucky provides a tax credit for certain costs associated with constructing, remodeling, equipping, or expanding facilities used for qualified research. The facility must be used for research that meets the applicable federal definition under IRC Section 41. The credit focuses on qualifying facility-related expenditures rather than research wages and supplies. Kentucky also provides separate sales and use tax provisions that may apply to certain research equipment, subject to applicable requirements.
Eligibility
- Corporations and individuals may qualify if they construct, remodel, equip, or expand a qualified research facility in Kentucky.
- The facility must be located in Kentucky and used for qualified research.
- The research activities must meet the applicable federal definition under IRC Section 41.
- Qualifying costs and facility requirements are subject to applicable Kentucky rules.
Benefits
- Non-refundable tax credit against Kentucky income tax and limited liability entity tax.
- Credit applies to qualifying costs associated with constructing, remodeling, equipping, or expanding a qualified research facility.
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