Louisiana Research & Development Tax Credit

Louisiana R&D Tax Credit — FY Allocation

Runs a tax credit program in Louisiana for companies investing in qualifying innovation.

Louisiana's Research and Development Tax Credit is a state income-tax credit of up to 30% on qualified R&D expenditures conducted within Louisiana, administered by Louisiana Economic Development (LED) with claims processed through the Louisiana Department of Revenue (LDR). The credit is tiered by company size, with rates of approximately 30%, 18%, and 8% depending on employee count (per third-party sources); the maximum 30% rate applies to smaller companies. Qualified expenditures include wages paid to research and supervisory employees, supplies consumed in qualified research, and 65% of qualifying contract-research costs performed in Louisiana. Credits carry forward for up to five years if not fully used in the award year.

A statewide annual cap of $12 million was introduced effective July 1, 2025, allocated on a first-come, first-served basis each fiscal year starting July 1. The FY 2025–26 cap was fully allocated before year-end, meaning new applicants must wait for the FY 2026–27 allocation window opening July 1, 2026. Professional-services firms and custom manufacturers face an additional requirement: a pending or issued US patent related to the research. Applications must be submitted within one year after December 31 of the expenditure year. The programme sunsets on December 31, 2029. Both for-profit and nonprofit entities conducting R&D in Louisiana are eligible; universities, research-only organisations, and individuals are excluded.

Because the $12M cap is first-come, first-served, applicants should file as early as possible after July 1 each year. The standard review and approval timeline is three to six months: online application to LED, LED review and written approval, then credit claimed on the Louisiana income tax return via LDR. Companies with previously disallowed claims due to the FY 2025–26 cap exhaustion receive priority consideration in the FY 2026–27 cycle.