Tax credits and incentives
Find federal and state business tax credits and incentives. Compare eligibility, amounts, claim steps and timing against the linked official sources.
This directory is not tax advice. Confirm eligibility, tax-year rules, deadlines and filing requirements with a tax professional.
Amounts are subject to the conditions in each listing. A source review does not mean applications are open or that a business qualifies.
State programs
Choose a state to see researched programs and their official requirements. This directory is a selection, not a complete list of every incentive.
- Alabama2 programs
- Alaska1 program
- Arizona1 program
- Arkansas1 program
- California1 program
- Colorado2 programs
- Connecticut2 programs
- Delaware1 program
- District of Columbia1 program
- Florida2 programs
- Georgia2 programs
- Hawaii1 program
- Idaho1 program
- Illinois1 program
- Indiana1 program
- Iowa1 program
- Kansas1 program
- Kentucky1 program
- Louisiana1 program
- Maine1 program
- Maryland1 program
- Massachusetts1 program
- Michigan1 program
- Minnesota1 program
- Mississippi1 program
- Missouri1 program
- Montana1 program
- Nebraska1 program
- Nevada1 program
- New Hampshire1 program
- New Jersey1 program
- New Mexico1 program
- New York1 program
- North Carolina1 program
- North Dakota1 program
- Ohio1 program
- Oklahoma1 program
- Oregon1 program
- Pennsylvania1 program
- Rhode Island1 program
- South Carolina1 program
- South Dakota1 program
- Tennessee1 program
- Texas1 program
- Utah1 program
- Vermont1 program
- Virginia1 program
- Washington1 program
- West Virginia1 program
- Wisconsin1 program
- Wyoming1 program
Federal programs
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Research credit and startup payroll tax offset
Tax credit
Regular credit generally includes 20% of qualified research expenses above a base; the alternative simplified method generally uses 14% above half the prior three-year average. Eligible startups may elect up to $500,000 for payroll taxes. [IRS research credit and payroll election][IRS payroll research credit]
Check program requirements [IRS research credit and payroll election][IRS Form 6765 instructions][IRS payroll research credit]
Eligibility, claim steps and deadlines for Research credit and startup payroll tax offset
- Who qualifies
- Businesses with qualifying research expenses. Payroll election: gross receipts below $5 million for the year and none before the five-tax-year period ending that year; tax-exempt organizations are excluded. [IRS Form 6765 instructions]
- What it’s worth
- Regular credit generally includes 20% of qualified research expenses above a base; the alternative simplified method generally uses 14% above half the prior three-year average. Eligible startups may elect up to $500,000 for payroll taxes. [IRS research credit and payroll election][IRS payroll research credit]
- How to claim
- Calculate on Form 6765. For the payroll offset, elect on the income tax return, then attach Form 8974 to the employment tax return, such as Form 941. [IRS research credit and payroll election]
- Deadlines and application windows
- Make the payroll election with a timely original return, including extensions. Start claiming in the first calendar quarter after filing; the election is limited to five tax years. [IRS payroll research credit][IRS Form 6765 instructions]
Sources reviewed
Full details and sources for Research credit and startup payroll tax offset
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Work Opportunity Tax Credit
Tax credit
Generally 40% of up to $6,000 of first-year wages for qualifying employees working at least 400 hours; other rates and wage limits apply to particular groups. [IRS Work Opportunity Tax Credit]
Authorization through 2025; do not assume 2026 hires qualify [IRS Work Opportunity Tax Credit]
Eligibility, claim steps and deadlines for Work Opportunity Tax Credit
- Who qualifies
- Employers hiring certified members of specified target groups; tax-exempt employers qualify only for certain veteran hires. [IRS Work Opportunity Tax Credit]
- What it’s worth
- Generally 40% of up to $6,000 of first-year wages for qualifying employees working at least 400 hours; other rates and wage limits apply to particular groups. [IRS Work Opportunity Tax Credit]
- How to claim
- Pre-screen with Form 8850 by the job-offer date and request state workforce certification. After certification, taxable employers use Forms 5884 and 3800; eligible tax-exempt employers use Form 5884-C. [IRS Work Opportunity Tax Credit]
- Deadlines and application windows
- Published federal authorization runs through December 31, 2025. Submit Form 8850 within 28 days after work starts. [IRS Work Opportunity Tax Credit]
Sources reviewed
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Small employer health insurance credit
Tax credit
Up to 50% of qualifying premiums for taxable employers, or 35% for eligible tax-exempt employers; the credit phases down with wages and employee count. [IRS small business health care credit]
Check program requirements [IRS small business health care credit]
Eligibility, claim steps and deadlines for Small employer health insurance credit
- Who qualifies
- Employers with fewer than 25 full-time equivalent employees, average wages below the annually adjusted limit, and qualifying SHOP coverage (or an exception), paying at least 50% of employee-only premiums. [IRS small business health care credit]
- What it’s worth
- Up to 50% of qualifying premiums for taxable employers, or 35% for eligible tax-exempt employers; the credit phases down with wages and employee count. [IRS small business health care credit]
- How to claim
- Calculate with Form 8941. Businesses include it in the general business credit on the income tax return; tax-exempt employers file Form 990-T even if otherwise not required. [IRS small business health care credit]
- Deadlines and application windows
- Available for two consecutive taxable years. Use the wage thresholds and form instructions for the tax year being claimed. [IRS small business health care credit]
Sources reviewed
Full details and sources for Small employer health insurance credit
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Small employer pension plan startup credit
Tax credit
For 1–50 qualifying employees, 100% of eligible startup costs; for 51–100, 50%. Annual cap: the greater of $500 or the lesser of $250 per eligible non-highly compensated employee and $5,000. [IRS retirement plan startup credit]
Check program requirements [IRS retirement plan startup credit]
Eligibility, claim steps and deadlines for Small employer pension plan startup credit
- Who qualifies
- Employers with 100 or fewer employees paid at least $5,000 in the preceding year, at least one non-highly compensated participant, and no substantially overlapping employer plan in the prior three tax years. [IRS retirement plan startup credit]
- What it’s worth
- For 1–50 qualifying employees, 100% of eligible startup costs; for 51–100, 50%. Annual cap: the greater of $500 or the lesser of $250 per eligible non-highly compensated employee and $5,000. [IRS retirement plan startup credit]
- How to claim
- Claim qualifying SEP, SIMPLE IRA or qualified-plan startup costs with Form 8881. The same startup costs cannot also be deducted. [IRS retirement plan startup credit]
- Deadlines and application windows
- Startup credit available for three years. [IRS retirement plan startup credit]
Sources reviewed
Full details and sources for Small employer pension plan startup credit
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Disabled access credit
Tax credit
50% of eligible expenditures above $250, with a maximum credit of $5,000. [IRS Form 8826 and instructions]
Check program requirements [IRS Form 8826 and instructions]
Eligibility, claim steps and deadlines for Disabled access credit
- Who qualifies
- Businesses with preceding-year gross receipts of no more than $1 million or no more than 30 full-time employees, incurring eligible costs to meet Americans with Disabilities Act requirements. [IRS Form 8826 and instructions]
- What it’s worth
- 50% of eligible expenditures above $250, with a maximum credit of $5,000. [IRS Form 8826 and instructions]
- How to claim
- Use Form 8826 with the tax return. Partnerships and S corporations report on Schedule K; other claimants generally report on Form 3800. [IRS Form 8826 and instructions]
- Deadlines and application windows
- Claim for the tax year of eligible expenditures; the form does not publish a separate application window. [IRS Form 8826 and instructions]
Sources reviewed
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Energy-efficient commercial buildings deduction (179D)
Tax deduction
For tax years beginning in 2026, base amounts range from $0.59 to $1.19 per square foot. A higher deduction can apply under prevailing-wage and apprenticeship rules; cost and prior deductions also limit the claim. [IRS Form 7205 instructions][IRS commercial buildings deduction]
Construction-start cutoff has passed [IRS Form 7205 instructions]
Eligibility, claim steps and deadlines for Energy-efficient commercial buildings deduction (179D)
- Who qualifies
- Owners of qualifying energy-efficient commercial building property and eligible designers allocated a deduction. Property must meet certification and energy-saving requirements. [IRS commercial buildings deduction]
- What it’s worth
- For tax years beginning in 2026, base amounts range from $0.59 to $1.19 per square foot. A higher deduction can apply under prevailing-wage and apprenticeship rules; cost and prior deductions also limit the claim. [IRS Form 7205 instructions][IRS commercial buildings deduction]
- How to claim
- File Form 7205 for qualifying property placed in service during the tax year; provide certification and any required allocation information. [IRS Form 7205 instructions]
- Deadlines and application windows
- Unavailable for property whose construction begins after June 30, 2026. [IRS Form 7205 instructions]
Sources reviewed
Full details and sources for Energy-efficient commercial buildings deduction (179D)
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Commercial clean vehicle credit (45W)
Tax credit
Up to $7,500 for vehicles under 14,000 pounds GVWR or $40,000 for heavier vehicles, limited by basis percentage and incremental cost. Business credits are nonrefundable. [IRS commercial clean vehicle credit]
Acquisition cutoff has passed [IRS commercial clean vehicle credit]
Eligibility, claim steps and deadlines for Commercial clean vehicle credit (45W)
- Who qualifies
- Businesses and eligible tax-exempt organizations placing qualifying commercial clean vehicles in service for US use, not resale, subject to vehicle and depreciation rules. [IRS commercial clean vehicle credit]
- What it’s worth
- Up to $7,500 for vehicles under 14,000 pounds GVWR or $40,000 for heavier vehicles, limited by basis percentage and incremental cost. Business credits are nonrefundable. [IRS commercial clean vehicle credit]
- How to claim
- IRS lists Form 8936 for partnerships and S corporations and Form 3800 for other taxpayers; tax-exempt entities file Form 990-T with Form 3800. Follow the applicable-year instructions. [IRS commercial clean vehicle credit]
- Deadlines and application windows
- Vehicles acquired after September 30, 2025 are ineligible. A binding written contract and payment by that date can qualify a later delivery, subject to all other requirements. [IRS commercial clean vehicle credit]
Sources reviewed
Full details and sources for Commercial clean vehicle credit (45W)