Louisiana Research and Development Credit

At a glance

• Jurisdiction: Louisiana (LA)
• Credit name: Louisiana Research and Development Tax Credit (La. R.S. 47:6015)
• Administering agency:
  • Louisiana Economic Development (LED) reviews applications and certifies credits.
  • The Louisiana Department of Revenue (LDR) processes claims on returns and administers the annual cap and the tax credit registry.
• Rate(s) and base: Rates depend on the entity's total employees, counting affiliates:
  • Fewer than 50 employees: 30% of Louisiana QREs above a base of 50% of the average Louisiana QREs for the three preceding years.
  • 50–99 employees: 10% of Louisiana QREs above a base of 80% of that average.
  • 100 or more employees: 5% above the same 80% base.
  • Separately, recipients of SBIR or STTR Phase I or II awards can claim 30% of the award received during the year.
• Refundable? No
• Transferable? General R&D credits: no. SBIR/STTR-based credits: yes, they may be sold or transferred to another Louisiana taxpayer. The rules:
  • Notify LDR within 10 business days.
  • Pay a $200 fee per transferee.
  • The transfer is not effective until it is recorded in the tax credit registry.
  • LDR's process uses Form R-6111.
• Carryforward: 5 years. For periods beginning on or after January 1, 2026, the credit carries forward against income tax only.
• Annual cap / proration:
  • Claims are capped at $12 million statewide per fiscal year (July 1–June 30), starting July 1, 2025. Claims are allowed first-come, first-served when the credit is claimed on a return.
  • Claims denied because the cap was reached (LDR "deferral letters") may be claimed on an original return filed in the next fiscal year, with priority.
  • The FY 2025-26 cap was used up.
• Pre-approval / application and deadline: Required. You must apply to LED and receive certification before claiming. The deadline is one year after December 31 of the year the expenses were incurred (for example, December 31, 2026 for 2025 expenses).
  • Application fee: 0.5% of the credit requested, minimum $500, maximum $15,000.
  • Applicants with fewer than 50 employees that did not file Form 6765 also need an expenditure verification report. It is billed at cost (maximum $15,000 or $25,000) and requires a deposit of $7,500 or $15,000.
• Forms:
  • LED online application, with the federal return and Form 6765 (or, for applicants with fewer than 50 employees that did not file Form 6765, the records LED requires for the expenditure verification report)
  • LED certification, claimed on the Louisiana income tax return
  • Form R-6111 for SBIR/STTR transfers
  • Form R-20128 to request a penalty waiver on deferred claims
• Sunset / recent changes: No credit for research expenditures incurred, or SBIR/STTR funds received, after December 31, 2029. The $12 million cap (R.S. 47:6015(M), enacted by Act 11 of the 2024 Third Extraordinary Session) took effect July 1, 2025. The corporation franchise tax was repealed for periods beginning on or after January 1, 2026 (Act 6 of the same session), so the credit now offsets income tax only. The 2025 and 2026 regular sessions did not amend R.S. 47:6015.

What it is

Louisiana's R&D credit is an incremental credit on Louisiana QREs, with the highest rate (30%) for small employers. It is a certified credit: LED must review and approve each application, and at least 10% of applications get a detailed examination. Since July 1, 2025, total claims are also limited to $12 million a year, allocated in the order returns claiming the credit are filed.

Who can claim it

• Taxpayers that incur QREs (as defined in IRC §41) for research performed in Louisiana, and recipients of federal SBIR/STTR Phase I or II awards.
• Employee count: all employees of the entity and its affiliates are counted, not only Louisiana employees.
• Ineligible: professional services firms and businesses primarily engaged in custom manufacturing or fabricating. They become eligible only if they hold a pending or issued U.S. patent directly related to the expenditures, or the Secretary of Economic Development invites them to apply.
• No double benefit: expenditures rewarded under another LED incentive generally do not qualify. There is a limited exception for small businesses that received state grants under R.S. 51:2401 or 2402.
• Contract research: only 65% of Louisiana contract research qualifies, the work must be performed in Louisiana, and there must be a written agreement before the work begins.

How it is calculated

The certified credit offsets Louisiana income tax. Any excess carries forward 5 years, and it cannot be refunded.

How to claim it

1. Apply to LED through the online application. Pay the fee and attach:
   • the federal return and Form 6765 for the current and three prior years, or Louisiana-only QREs where applicable;
   • total and Louisiana QREs;
   • Louisiana employee counts (total and R&D);
   • average wages for R&D and non-R&D employees;
   • benefit and health insurance values;
   • on request, IRS Forms 8821 and 4506.
2. Meet the deadline: apply by December 31 of the year after the expense year.
3. Wait for LED certification. Processing typically takes 3–6 months. LED notifies LDR when it approves a credit.
4. Claim the certified credit on the original or amended Louisiana return. Under LDR's July 8, 2026 guidance:
   • Credits claimed on original returns filed July 1, 2026 through June 30, 2027 fall under the FY 2026-27 cap, whatever the tax year.
   • Deferred credits get priority only if claimed on an original return filed in that window.
   • Amended returns cannot move deferred credits into a later year's cap. An amended return can claim a credit that was not claimed on the original return, but that claim is tested against the cap in effect when the amended return is filed.
   • Penalties and interest on a deferred claim run from the original due date. Penalties may be waived on Form R-20128; interest cannot be waived.
5. SBIR/STTR credit transfers: file Form R-6111 by the due date of the return claiming the credits, notify LDR within 10 business days, and pay $200 per transferee.

Recent changes

• Act 11 of the 2024 Third Extraordinary Session (HB 10, signed and effective December 4, 2024), § 2: enacted R.S. 47:6015(M), a $12 million aggregate cap on R&D credit claims against state income tax each fiscal year, beginning July 1, 2025. Claims are allowed first-come, first-served, and a claim disallowed because the cap was reached may be used on an original return filed in the next fiscal year, with priority over later claims.
• Act 5 of the 2024 Third Extraordinary Session (HB 2), effective January 1, 2025: repealed former Subsection L of R.S. 47:6015 as part of the corporate income tax overhaul.
• Corporation franchise tax repeal (Act 6 of the 2024 Third Extraordinary Session, HB 3): effective for periods beginning on or after January 1, 2026. Act 6 also amended R.S. 47:6015, effective January 1, 2026. Since then the R&D credit and its carryforward apply only against income tax.
• LDR guidance (July 8, 2026): confirmed that the FY 2025-26 cap was reached and explained deferral letters, priority for deferred credits under the FY 2026-27 cap, and penalty waivers. LDR said it does not plan to post regular cap-status updates.
• Sunset: the credit does not apply to expenditures incurred after December 31, 2029.

Likely examiner questions

These questions illustrate what an examiner may ask about this credit. They are drafts for illustration and should be reviewed by a specialist before use. Most state claims also face standard questions: where the research was physically performed, how wages, supplies and contract research were apportioned between Louisiana and other locations, how Louisiana amounts reconcile to federal Form 6765, the Louisiana credit and carryforward schedule for each year claimed, and whether the claiming entity is the one subject to Louisiana tax.

1. Provide the LED certification letter and show that the credit claimed does not exceed the certified amount.
2. Provide the total employee count for the entity and all affiliates that supports the rate tier and base percentage used.
3. Reconcile Louisiana QREs to Form 6765 and show they relate to research physically performed in Louisiana. Provide the three-year Louisiana QRE history used for the base.
4. For contract research, provide the written agreement signed before the work began, and show that the work was performed in Louisiana and that 65% was applied.
5. For professional services or custom manufacturing businesses, provide the related patent or patent application, or the Secretary's invitation.
6. Show that no other LED incentive was received for the same expenditures.
7. For SBIR/STTR credits, provide the award, the disbursement records and bank statements. For any transfer, provide Form R-6111 and the registry recording.
8. For deferred credits, provide the LDR deferral letter and show the credit was claimed on an original return in the correct fiscal-year window.

Common weak spots

• Rate tier based on Louisiana employees only instead of total employees including affiliates.
• Credit claimed before LED certification, or the LED application filed after the one-year deadline.
• Benefit modeled without the $12 million cap. Claims filed late in the fiscal year may be deferred.
• Deferred credit moved to a later year on an amended return (not allowed).
• Credit applied against franchise tax for 2026 or later periods.
• Contract research without a prior written agreement, or performed outside Louisiana.

Next steps

• Run a mock audit for Louisiana
• Official source: Louisiana Economic Development, research and development tax credit (opens in a new tab)
• Run the eligibility checker
• Book a scoping call with Swanson Reed (opens Swanson Reed's booking calendar in a new tab)
• Contact us: +1 (469) 206-4335 or hello@creditarmor.ai

Important

This page is general information, not tax advice. Rules change; confirm current requirements with the state revenue agency or a qualified tax professional. creditARMOR is a free service. Passing this mock audit does not guarantee that your claim will pass an IRS or state examination. If needed, Swanson Reed can assist you with representation before the IRS. creditARMOR and TaxTrex are products of Swanson Reed.