State R&D Credit Explorer

Federal R&E expensing (Section 174A): For tax years beginning after December 31, 2024, domestic research or experimental expenditures may be deducted when paid or incurred (or amortized over at least 60 months by election). Foreign research costs remain amortized over 15 years. Unamortized 2022–2024 domestic costs may be deducted in the first 2025 tax year or over two years. States differ on whether they follow these rules; check the state entry.

P.L. 119-21 did not change federal research credit rates or calculations; it updated §41's qualified-research cross-reference to new §174A and changed §280C(c) so the 174A deduction is reduced by the credit unless the taxpayer elects a reduced credit. States that adopt §41 as of a fixed date may use the earlier text.