Tax Credits
Article 3J Tax Credits - Provides tax credits to qualifying businesses for job creation, investment in business property and in some cases investment in real property. Article 3J Tax Credits offer several types of tax credits to eligible taxpayers that undertake qualifying initiatives. These credits may be used to offset up to 50% of the taxpayer's state income and/or franchise tax liability, and unused credits may be carried forward for up to five years. Read More
Research and Development Tax Credits - Provides tax credits for qualified North Carolina research expenses during a taxable year. Credit is based on a percentage of qualified research expenses with the highest amounts for research performed by North Carolina universities.
Businesses with qualified North Carolina research expenses are allowed a credit equal to a percentage of those expenses. The allowable credits are determined by:
- Small business (annual receipts less than $1 million): Qualified businesses on the last day of the taxable year are allowed a credit of 3.25%.
- Low-tier research: For expenses for research performed in a Tier 1 county, a business is permitted a credit of 3.25%.
- Other research: For expenses not covered above, refer to the table below for qualified research expenses during a taxable year:
| Qualified Expenses | Rate |
| $0-$50 million | 1.25% |
| $50 - $200 million | 2.25% |
| More than $200 million | 3.25% |
A business with North Carolina university research expenses for the taxable year is allowed a credit equal to 20% of those expenses. Read More
N.C. Ports Tax Credits - Provides tax credits towards income taxes paid by businesses or individuals using ports facilities at N.C. Ports at Morehead City and Wilmington. Businesses who pay North Carolina state income tax and use North Carolina ports can qualify for tax credits on outbound cargo.
The credit is earned on cargo wharfage and handling fees paid to the N.C. State Ports Authority which exceed the average for over three tax years. The credit applies to taxes due to the state - up to 50% of the total tax liability for each tax year. Any unused credit may be carried forwarded up to five years for a total credit of up to $2 million.
For more information on ports tax credit or services, visit the N.C. State Ports website or call 1-800-334-0682.
Renewable Energy Tax Credits - Provides a tax credit of 35% of the cost of renewable energy property. North Carolina's various renewable-energy tax credits are unified into a statute that addresses nearly all renewables. The statute provides a tax credit of 35% of the cost of renewable energy property constructed, purchased or leased by a taxpayer and placed into service in North Carolina during the taxable year. Read More
