R&D Tax Credits
in Kansas

Starting from tax year 2022 and onwards, the state of Kansas has raised the R&D tax credit percentage from 6.5% to 10% of a taxpayer’s qualifying R&D expenses. These expenses must comply with the guidelines outlined in Section 41 of the Internal Revenue Code for research and development purposes.

In order to take advantage of the R&D Tax Credit in Kansas, you must fill out Schedule K-53 and include it when submitting your income tax return. Starting from the 2023 tax year, the credit can be transferred to another person who can use it to offset their Kansas income tax liability for the year it was transferred. It’s important to note that the credit can only be transferred once and in its entirety, and no refund will be granted for any unused portion of the credit.

Corporations that are subject to Kansas corporate income tax, such as C corporations, can take advantage of the Kansas Research and Development Tax Credit. Unfortunately, individuals, partnerships, S corporations, limited liability companies (LLCs), and other pass-through entities are not eligible for the Kansas R&D credit.

In Kansas, the R&D tax credit that can be claimed in a single tax year is capped at 25% of the credit amount, along with any amount carried forward from previous years. Any unused portion of the credit can be carried forward in increments of 25% until the full amount is utilized.