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Texas R&D Franchise Tax Credit

Texas R&D Franchise Tax Credit

Supports Texas companies through a state tax credit for eligible innovation spending to reduce commercialization costs.

OpenTexas Comptroller of Public AccountsUnited States
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About

The Texas Research and Development Franchise Tax Credit allows entities subject to the Texas franchise tax to claim a credit against their annual tax liability for qualifying research expenditures (QREs) conducted in Texas. Enacted under Senate Bill 2206 and effective January 1, 2026, the credit rate increased substantially from 5% to 8.722% for standard QREs and to 10.903% for R&D contracted to T…

What this grant funds

Franchise tax credits of 8.722%–10.903% on incremental qualified research and development expenditures conducted in Texas, claimable annually with a 20-year carryforward.

Key facts
CycleiHow often this grant runs — e.g. annually, on a rolling basis, or a one-off call.Annual
Next deadlineiThe next date applications are due. Rolling means you can apply any time.—
Decision timeiTypical time from the deadline to the funder's decision.—
Project durationiHow long the funded work is expected to run.—
Award typeiThe form of funding — grant, equity, loan, tax credit, etc.Tax credit
Match fundingiThe share of project costs you must cover yourself. 0% = fully funded.0%
Funding pooliThe total budget available across all awards in this round.—
Funding analytics

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Industries

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Eligibility criteria

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Timeline

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Last verified: 24 Jul 2026Source: comptroller.texas.gov