R&D Tax Credits in Kentucky

Kentucky Qualified Research Facility Tax Credit

Maximize your tax savings for businesses across industries.


The Research and Development Tax Credit (R&D) or Qualified Research Facility Tax Credit in Kentucky is a tax credit available to businesses of all sizes that engage in R&D activities in the United States. This tax credit is not limited to scientists and research labs, but is open to various industries and businesses. The R&D tax credit was implemented to encourage research and development in the United States. This credit is increasingly being utilized by companies every year. Furthermore, the Protecting Americans from Tax Hikes (PATH) Act, enacted in 2015, made the R&D tax credits permanent and expanded the eligibility to include startups.

What are the Potential Benefits of the Qualified Research Facility Tax Credit?

Qualifying companies can save costs through R&D tax credits. These benefits include:

  • Increasing Cash Flow
  • Federal and State Dollar-for-Dollar Income Tax Reduction
  • Claim Credits for Open Tax Years Going Back 3-4 Years
  • Reducing Your Tax Rate


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Who Can Claim the Qualified Research Facility Tax Credit?

Previously, there was a mistaken belief that R&D tax credits only pertained to those wearing lab coats or creating best-in-class products. This is not accurate – R&D credits have a broader and more inclusive reach than commonly thought.

Discover the hidden opportunity of Research and Development (R&D) Tax Credits for businesses. Companies, regardless of size or industry, may be eligible for this valuable benefit. Sadly, countless businesses are missing out on substantial federal and state tax credits without even realizing it.

The R&D tax credit applies to the activities that fuel your business's growth.

  • Developed new products
  • Improved existing products
  • Developed software for internal or external use
  • Improved manufacturing processes

The activities that qualify for the Kentucky Qualified Research Facility Tax Credit are the same ones driving growth in your business.

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How Do I Claim the Qualified Research Facility Tax Credit?

Companies can claim 7-10% of their qualified expenses as a federal R&D tax credit, on average. For instance, a software developer, engineer, or lab technician earning $100,000 annually can potentially save up to $10,000 in taxes.

The expenses that can be considered as research activities within your company generally include employee compensation, materials, and contracted services. To support your qualified expenses, you can provide various forms of documentation such as payroll records, financial records showing supply or contract research expenses, and vendor invoices.