Cellulosic Ethanol Technology Research and Development Tax Credit

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Businesses that incur qualified research and development expenses for cellulosic ethanol technology in Maryland are entitled to a tax credit. The total credits for all businesses may not exceed $250,000 per year.

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Cellulosic Ethanol Technology Research and Development Tax Credit

  1. 1. Cellulosic Ethanol Technology Research and Development Tax Credit Businesses that incur qualified research and development expenses for cellulosic ethanol technology in Maryland are entitled to a tax credit. The total credits for all businesses may not exceed $250,000 per year. This credit is available for tax years beginning after December 31, 2007, but before January 1, 2017. The credit may be taken against corporate income tax or personal income tax. Sole proprietorships, corporations and pass through entities, such as partnerships, subchapter S corporations, limited liability companies and business trusts may claim the tax credit. To qualify for the credit: The business must invest in research and development activities in Maryland related to cellulosic ethanol technology, which is technology that is used to develop cellulosic biomass for conversion to ethanol fuel. The business must also submit an application for the credit to the Maryland Department of Business and Economic Development (DBED) by September 15 of the calendar year following the end of the tax year in which the qualified research and development expenses were paid or incurred. DBED will certify the amount of the allowable credit to the business by December 15. How the credit is calculated: The amount of the tax credit is equal to 10% of the qualified research and development expenses paid or incurred during the tax year. DBED may not approve more than $250,000 in credits for any calendar year. If the aggregate amount of credits applied for exceeds $250,000, each applicant will receive a prorated share of the total credit amount. If the credit is more than the state tax liability, the unused credit may be carried forward for the next 15 years. Documentation required: A copy of the certification received from DBED must be submitted with the appropriate Maryland Income Tax Return - Form 500 for Corporations, Form 510 for Pass-Through Entities and Form 502 for Individuals.
  2. 2. Contact: Maryland Department of Business and Economic Development Office of Finance Programs, Tax Incentives Group 401 East Pratt Street Baltimore, MD 21202 Phone: 410-767-6438 or 410-767-4980 E-mail: taxincentives@choosemaryland.org McMillan Consulting 828A E. Baltimore St. Baltimore, MD 21202 Phone: 410-775-6226 Web: http://mcmillancos.com E-mail: info@mcmillancos.com McMillan Consulting is not affiliated with the state of Maryland. This document is for informational purposes. Contact us, the appropriate agency for this credit or your tax professional for further assistance. You can view Maryland's tax credits by visiting http://macadvises.net/mdtaxsignal.php and clicking on the MD Business Tax Credits link. We can send you a hard copy of this or any of our info sheets for Maryland tax credits.

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