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The Louisiana Research and Development Tax Credit, administered by the Louisiana Economic Development (LED), rewards businesses for conducting qualified research activities in the state, providing a nonrefundable offset against income or franchise tax liabilities. Beginning July 1, 2025, total R&D credits allowed each state fiscal year are capped at $12 million on a first-come, first-served basis, with priority filing for previously disallowed claims in the following year.
Eligibility requires performing qualified research activities (QRAs) in Louisiana that align with federal guidelines under IRC §41, including the §174 requirement and the four-part test: technological in nature, intended to eliminate uncertainty, substantially experimental (80%+), and for a permitted purpose like developing or improving a business component. Only Louisiana-incurred expenses qualify, and the LED application must be submitted within one year after December 31 of the expenditure year.
Louisiana uses an incremental method based on employee count, applying a tiered percentage to excess QREs over a base derived from prior years' averages. Only Louisiana-sourced QREs qualify, using full-time equivalent Louisiana employees at year-end. No alternative simplified credit is available.
Louisiana's R&D credit emphasizes small businesses through employee tiers and requires pre-claim safeguards, setting it apart from federal uniformity.
Illustrative results from a Louisiana manufacturing firm using the small business tier.
The Louisiana R&D tax credit is tiered based on employee count: 30% for businesses with fewer than 50 employees, 10% for 50-99, and 5% for 100 or more; it also offers 30% for SBIR/STTR grants, with an annual program cap of $12 million starting July 1, 2025. Contact Strike Tax to maximize your savings.
Activities must meet federal IRC § 41 criteria, be conducted in Louisiana, and involve at least 80% experimentation, such as developing new products or improving processes; excludes professional services or custom manufacturing without patents. Strike Tax can identify qualifying projects.
A 50-employee firm with $1 million in excess QREs could claim $300,000, stacked with federal credits for up to $500,000 total. Larger firms see scaled savings. Use Strike Tax’s R&D Credit Calculator for estimates.
No, credits are nonrefundable but carry forward up to 5 years for tax offsets. The 30% small business tier maximizes value; SBIR/STTR portions are transferable. Strike Tax optimizes for carryforward use.
Submit LED online application within one year of expenditure year-end, with QRE details and fee (0.5% of credit; min. $500). Obtain certification before claiming on your state return. Strike Tax manages documentation and compliance.
Yes, stack state and federal for the same Louisiana QREs using shared IRC §41 definitions. No double-dipping issues. Strike Tax coordinates dual claims.
Base is 50% of prior 3-year average QREs for <50 employees or 80% for larger (0% if no prior). Startups often qualify 100% of current QREs. Strike Tax handles precise computations.
$12 million per fiscal year (July 1 start), first-come, first-served. File early; no per-firm limit, and disallowed claims prioritize next year. Strike Tax advises on timing strategies.
Yes, only the 30% SBIR/STTR credit (on Phase I/II award amounts) is transferable/sellable via the registry (Form R-6135). Standard credits are not. Strike Tax assists with transfers.
Employee tiers favor small innovators, with full federal stacking and 5-year carryforward. LED certification ensures compliance. Strike Tax customizes for Louisiana sectors.
Use our calculator to estimate your potential federal and state benefits
Connect with us to find out how R&D tax credits can boost your organization’s bottom line.
The Louisiana Research and Development Tax Credit encourages existing businesses with operating facilities in Louisiana to establish or continue R&D activities within the state to receive up to a 30% tax credit on qualified research expenditures (QREs) incurred in Louisiana—with no cap and no minimum requirement.
The incentive is open to companies who meet certain eligibility requirements (see below) pertaining to R&D activities conducted in Louisiana.
In order for credits to be awarded, a taxpayer must claim the expenditures within one year after December 31 of the tax period in which the expenditures were incurred.
Louisiana R&D credits are claimed using an online application system.
Ineligible Businesses
The following businesses will be ineligible to participate in the Research and Development tax credit program, unless specifically invited by the Department of Louisiana Economic Development (LED):
Learn more about Louisiana's R&D Tax Credit here, here, and here.
R&D Tax Credit Available:
Yes
Eligible Entities:
C-Corporation, S-Corporations, LLCs, Partnerships
Deadline for Tax Filing:
Due with Louisiana Tax Return
Data Required to Compute Credit:
Claim Period Federal Qualified R&D Expenses (QREs)
What Information is needed?
Louisiana QREs for Prior 3 Years
Number of Louisiana Employees
Credit Carryforward:
5 Years
To get an estimate of the potential value of your unclaimed R&D Tax Credits, try out our credit calculator.
Download our R&D Tax Credit Calculator for Android to see how much you can receive from your qualified R&D tax credit expenses.
The Louisiana R&D tax credit is tiered based on employee count: 30% for businesses with fewer than 50 employees, 10% for 50-99, and 5% for 100 or more; it also offers 30% for SBIR/STTR grants, with an annual program cap of $12 million starting July 1, 2025. Contact Strike Tax to maximize your savings.
Activities must meet federal IRC § 41 criteria, be conducted in Louisiana, and involve at least 80% experimentation, such as developing new products or improving processes; excludes professional services or custom manufacturing without patents. Strike Tax can identify qualifying projects.
A 50-employee firm with $1 million in excess QREs could claim $300,000, stacked with federal credits for up to $500,000 total. Larger firms see scaled savings. Use Strike Tax’s R&D Credit Calculator for estimates.
No, credits are nonrefundable but carry forward up to 5 years for tax offsets. The 30% small business tier maximizes value; SBIR/STTR portions are transferable. Strike Tax optimizes for carryforward use.
Submit LED online application within one year of expenditure year-end, with QRE details and fee (0.5% of credit; min. $500). Obtain certification before claiming on your state return. Strike Tax manages documentation and compliance.
Yes, stack state and federal for the same Louisiana QREs using shared IRC §41 definitions. No double-dipping issues. Strike Tax coordinates dual claims.
Base is 50% of prior 3-year average QREs for <50 employees or 80% for larger (0% if no prior). Startups often qualify 100% of current QREs. Strike Tax handles precise computations.
$12 million per fiscal year (July 1 start), first-come, first-served. File early; no per-firm limit, and disallowed claims prioritize next year. Strike Tax advises on timing strategies.
Yes, only the 30% SBIR/STTR credit (on Phase I/II award amounts) is transferable/sellable via the registry (Form R-6135). Standard credits are not. Strike Tax assists with transfers.
Employee tiers favor small innovators, with full federal stacking and 5-year carryforward. LED certification ensures compliance. Strike Tax customizes for Louisiana sectors.
