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<!DOCTYPE html><html dir="ltr" lang="en-us"><head><meta charSet="utf-8" data-next-head=""/><meta name="viewport" content="width=device-width" data-next-head=""/><title data-next-head="">Georgia R&D tax credit: How your business can benefit | Remote</title><meta name="description" content="If your business is engaged in research, you may be eligible for the Georgia R&D tax credit. Here’s everything you need to know about making a claim." data-next-head=""/><meta name="twitter:card" content="summary" data-next-head=""/><meta name="twitter:creator" content="@pedrocmb" data-next-head=""/><meta name="twitter:title" content="Georgia R&D tax credit: How your business can benefit" data-next-head=""/><meta name="twitter:description" content="If your business is engaged in research, you may be eligible for the Georgia R&D tax credit. 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src="https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2F7q2lf3vBovOA2fr6oUnZDn%2F3c76b24e16e7f006357dfba3d487b5dc%2Fpexels-nate-hovee-3069537-5063779__1_.jpg%3Ffm%3Dwebp%26w%3D1920&w=3840&q=75"/></div><div class="sc-2e52db73-7 hWOHlD"><p class="sc-3bc81b6a-7 jBjSIp"><a href="https://remote.com/blog/category/tax-compliance" tabindex="0" class="sc-e8e52cf3-6 etbnLB">Tax and Compliance</a> — 5 min</p><h1 class="sc-2e52db73-16 kKMbKO">Georgia R&D tax credit: How your business can benefit</h1><div class="sc-2e52db73-8 fmNcQl"><div class="sc-2e52db73-10 ZOqHE">Written by <span class="sc-2e52db73-13 bzmmVn"><a href="/blog/author/pedro-barros">Pedro Barros</a></span></div><div class="sc-2e52db73-14 jlqTyM"><span class="sc-2e52db73-15 buvXPN">February 19, 2025</span></div><div class="sc-2e52db73-11 SMXEN"><div class="sc-2e52db73-12 bTUqIa"><span class="sc-2e52db73-9 kxOwCo"><a href="/blog/author/pedro-barros"><img alt="Pedro Barros" loading="lazy" width="40" height="40" decoding="async" data-nimg="1" style="color:transparent;object-fit:cover" srcSet="https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2F7thrwmibn9WbTyxWZJjyGf%2Fe43ce075f520c389f01109a39a0cb917%2Fhttps___images.prismic.io_all-remote-content_fef58e1d-b417-479e-83a6-2233d627a791_Pedro_0001_-_Pedro_Barros.jpg&w=48&q=75 1x, https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2F7thrwmibn9WbTyxWZJjyGf%2Fe43ce075f520c389f01109a39a0cb917%2Fhttps___images.prismic.io_all-remote-content_fef58e1d-b417-479e-83a6-2233d627a791_Pedro_0001_-_Pedro_Barros.jpg&w=96&q=75 2x" src="https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2F7thrwmibn9WbTyxWZJjyGf%2Fe43ce075f520c389f01109a39a0cb917%2Fhttps___images.prismic.io_all-remote-content_fef58e1d-b417-479e-83a6-2233d627a791_Pedro_0001_-_Pedro_Barros.jpg&w=96&q=75"/></a></span><div class="sc-9647c215-0 dEWPd"><a target="_blank" rel="noreferrer" href="https://twitter.com/pedrocmb" class="sc-9647c215-1 GzuEP"><svg width="21" height="14" viewBox="0 0 21 14" fill="none" xmlns="http://www.w3.org/2000/svg" class="sc-7a696e13-0 jTLkhI"><path fill-rule="evenodd" clip-rule="evenodd" d="M16.7 2.19a3.26 3.26 0 00-1.29-.805 3.29 3.29 0 00-1.52-.134 3.246 3.246 0 001.658-.626c0-.156 0-.313-.166-.313a3.27 3.27 0 00-1.326.313c.496-.313.663-.469.663-.625a3.158 3.158 0 00-1.658.781c.165-.312.332-.469.165-.625a1.26 1.26 0 00-.664.625c-.43.331-.771.76-.994 1.252a13.403 13.403 0 00-1.481 3.128H9.92A3.843 3.843 0 008.433 3.91c-.791-.482-1.62-.9-2.48-1.25a18.445 18.445 0 00-3.142-1.252c-.012.554.139 1.1.433 1.57.294.472.72.85 1.225 1.088a2.945 2.945 0 00-1.158.158c0 .938.827 1.72 2.316 2.033a2.768 2.768 0 00-1.489.47c.26.448.652.808 1.124 1.03a2.604 2.604 0 001.518.217 2.38 2.38 0 01-.497.314.665.665 0 00-.165.781c.331.471.663.627 1.488.627a5.413 5.413 0 01-1.973 1.255 5.464 5.464 0 01-2.326.309A5.477 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class="sc-2e52db73-17 eOLNpc"><div class="sc-2e52db73-4 kzgYuB"><p>Share</p><span></span><a href="https://www.linkedin.com/sharing/share-offsite/?url=https://remote.com/blog/research-development-tax-credit-georgia" target="_blank" rel="noreferrer" tabindex="0" class="sc-e8e52cf3-6 etbnLB"><img alt="share to linkedIn" loading="lazy" width="14" height="15" decoding="async" data-nimg="1" style="color:transparent" src="https://blog.remote.com/blog/images/icons/linkedIn.svg"/></a><a href="https://twitter.com/share?text=Georgia R&D tax credit: How your business can benefit&url=https://remote.com/blog/research-development-tax-credit-georgia" target="_blank" rel="noreferrer" tabindex="0" class="sc-e8e52cf3-6 etbnLB"><img alt="share to Twitter" loading="lazy" width="18" height="13" decoding="async" data-nimg="1" style="color:transparent" src="https://blog.remote.com/blog/images/icons/twitter.svg"/></a><a href="http://www.facebook.com/sharer.php?u=https://remote.com/blog/research-development-tax-credit-georgia&p[title]=Georgia R&D tax credit: How your business can benefit" target="_blank" rel="noreferrer" tabindex="0" class="sc-e8e52cf3-6 etbnLB"><img alt="share to Facebook" loading="lazy" width="8" height="17" decoding="async" data-nimg="1" style="color:transparent" src="https://blog.remote.com/blog/images/icons/facebook.svg"/></a><button><span class="sc-1cd0255a-0 hFkLur">copy link to clipboard</span><img alt="copy link to clipboard" aria-hidden="true" loading="lazy" width="20" height="21" decoding="async" data-nimg="1" style="color:transparent" src="https://blog.remote.com/blog/images/icons/link.svg"/></button><div class="sc-2e52db73-3 hJIEPk">Link copied <br/>to clipboard</div></div><div class="sc-2e52db73-18 iRGfhb"><p>If your business conducts research and development activities in Georgia, you may be eligible for the state’s R&D tax credit. This can help reduce your state tax liability and improve cash flow.</p><p>In this article, we’ll explain what exactly the R&D tax credit is, who is eligible for it, and what you need to do to claim it. So let’s jump straight in.</p><div class="sc-c8601491-0 cgKInu"><span class="sc-c8601491-1 jXMiBx"><svg viewBox="0 0 24 24" fill="currentColor" width="24" xmlns="http://www.w3.org/2000/svg" class="sc-c8601491-2 cChZlq"><path fill-rule="evenodd" clip-rule="evenodd" d="M1 3a1 1 0 011-1h6a5 5 0 015 5v14a1 1 0 11-2 0 2 2 0 00-2-2H2a1 1 0 01-1-1V3zm10 14.54V7a3 3 0 00-3-3H3v13h6a4 4 0 012 .54z"></path><path fill-rule="evenodd" clip-rule="evenodd" d="M12.46 3.46A5 5 0 0116 2h6a1 1 0 011 1v15a1 1 0 01-1 1h-7a2 2 0 00-2 2 1 1 0 11-2 0V7a5 5 0 011.46-3.54zM13 17.54a4 4 0 012-.54h6V4h-5a3 3 0 00-3 3v10.54z"></path></svg><span class="sc-c8601491-5 gUaBok">Jump straight to a key chapter</span></span><ul class="sc-c8601491-3 xDcKr"><li class="sc-c8601491-4 cKJYaE"><a href="#what-is-the-georgia-r-d-tax-credit" tabindex="0" class="sc-e8e52cf3-6 etbnLB">What is the Georgia R&D tax credit?</a></li><li class="sc-c8601491-4 cKJYaE"><a href="#what-are-the-benefits-of-the-georgia-r-d-tax-credit" tabindex="0" class="sc-e8e52cf3-6 etbnLB">What are the benefits of the Georgia R&D tax credit?</a></li><li class="sc-c8601491-4 cKJYaE"><a href="#who-is-eligible-for-the-georgia-r-d-tax-credit" tabindex="0" class="sc-e8e52cf3-6 etbnLB">Who is eligible for the Georgia R&D tax credit?</a></li><li class="sc-c8601491-4 cKJYaE"><a href="#how-do-you-apply-for-the-georgia-r-d-tax-credit" tabindex="0" class="sc-e8e52cf3-6 etbnLB">How do you apply for the Georgia R&D tax credit?</a></li><li class="sc-c8601491-4 cKJYaE"><a href="#can-you-claim-the-federal-r-d-tax-credit-and-the-georgia-r-d-tax-credit-together" tabindex="0" class="sc-e8e52cf3-6 etbnLB">Can you claim the federal R&D tax credit and the Georgia R&D tax credit together?</a></li><li class="sc-c8601491-4 cKJYaE"><a href="#is-the-georgia-r-d-tax-credit-worth-it" tabindex="0" class="sc-e8e52cf3-6 etbnLB">Is the Georgia R&D tax credit worth it?</a></li></ul></div><h2 id="what-is-the-georgia-r-d-tax-credit">What is the Georgia R&D tax credit?</h2><p>The Georgia R&D tax credit is a state incentive designed to encourage businesses to invest in research and development activities within the state. It allows eligible businesses to claim a credit of 10% of the increase in Georgia-based qualified research expenses (QREs) over a base amount.</p><p>This credit can be applied to offset your corporate income tax in Georgia and, if unused, a portion of your state payroll withholding taxes too.</p><h3 id="whats-the-difference-between-the-georgia-r-d-tax-credit-and-the-federal-r-d-tax-credit">What’s the difference between the Georgia R&D tax credit and the federal R&D tax credit?</h3><p>The key difference is that the federal credit applies to research conducted anywhere in the US, while the Georgia credit is limited to expenses incurred within the state.</p><p>Additionally, the federal credit offers a higher potential credit rate (up to 20%), while Georgia’s credit is capped at 10% (although, as mentioned, there is a payroll tax offset option).</p><h2 id="what-are-the-benefits-of-the-georgia-r-d-tax-credit">What are the benefits of the Georgia R&D tax credit?</h2><p>Claiming the Georgia R&D tax credit offers your business several advantages, including:</p><ul><li><p><b>Reduced tax liability</b>. The credit directly offsets your company’s corporate income tax in Georgia, allowing you to lower your overall tax burden.</p></li><li><p><b>Payroll tax benefits</b>. If your company doesn’t have enough income tax liability to use the credit, you can apply it to offset up to 50% of your payroll withholding taxes in the state.</p></li><li><p><b>More innovation</b>. By reducing the cost of R&D, your business can reinvest in product improvements, new technologies, and market expansion.</p></li><li><p><b>Improved cash flow</b>. Tax savings free up funds that can be allocated toward growth, hiring, or additional R&D efforts.</p></li></ul><p>If your business is engaged in a research-driven industry — such as technology, software, or manufacturing — the credit provides a tangible financial benefit that rewards innovation.</p><h2 id="who-is-eligible-for-the-georgia-r-d-tax-credit">Who is eligible for the Georgia R&D tax credit?</h2><p>The Georgia R&D tax credit is available to businesses of all sizes and industries, but you must meet specific eligibility requirements.</p><p>To qualify, your company must:</p><ul><li><p>Conduct research that is technological in nature, relying on principles from engineering, biology, chemistry, physics, or computer science.</p></li><li><p>Aim to develop new or improved products, processes, or software that enhance performance, reliability, or functionality.</p></li><li><p>Engage in experimental processes, including prototyping, testing, modeling, and analysis.</p></li><li><p>Incur QREs in Georgia, such as employee wages, supply costs, or third-party contract research.</p></li></ul><p>In most cases, this applies to companies in the technology, software, manufacturing, biotechnology, and aerospace fields. However, any business performing eligible research activities can apply.</p><h2 id="how-do-you-apply-for-the-georgia-r-d-tax-credit">How do you apply for the Georgia R&D tax credit?</h2><p>To apply for the Georgia R&D tax credit, your business must follow these steps:</p><h3 id="1-identify-your-qualified-research-activities-qr-as">1. Identify your qualified research activities (QRAs)</h3><p>First, review your internal projects and expenses to ensure they meet the eligibility criteria listed above.</p><h3 id="2-calculate-the-credit-amount">2. Calculate the credit amount</h3><p>To calculate the credit amount, use the following formula:</p><p>10% x (current-year Georgia QREs - base amount)</p><p>In Georgia, the base amount is determined using a fixed formula similar to the federal R&D tax credit calculation. It is based on your company’s historical research spending as a percentage of gross receipts, as follows:</p><p>Georgia gross receipts × (average Georgia QREs from past 3 years / average Georgia gross receipts from past 3 years)</p><p>For instance, let’s say:</p><ul><li><p>Your average QREs in Georgia over the past 3 years were $250,000</p></li><li><p>Your average gross receipts were $5.5 million</p></li><li><p>Your current year QREs are $400,000</p></li></ul><p>Using the formula, your base amount would be:</p><p>$5.5m x ($250k / $5.5m) = $250k</p><p>To calculate the credit, you would then use the first formula:</p><p>10% x ($400k - $250k) = $15,000</p><p>Note that, if your company has no prior QRE history, the base amount may be considered zero, meaning the full 10% applies to your current-year QREs.</p><h3 id="3-file-georgia-form-it-rd">3. File Georgia Form IT-RD</h3><p>This form must be submitted along with your Georgia corporate tax return to claim the credit.</p><h3 id="4-apply-any-unused-credits">4. Apply any unused credits</h3><p>If the income tax liability is insufficient, your business can either carry forward your unused credits for up to 10 years — or, as mentioned, apply them to offset up to 50% of your payroll withholding taxes.</p><h3 id="5-maintain-proper-documentation">5. Maintain proper documentation</h3><p>Ensure that you keep detailed records of your R&D activities, expenses, and employee roles in case of an audit. Specifically, you should aim to:</p><ul><li><p><b>Maintain organized records</b>. Keep thorough documentation of your projects, expenses, employee activities, and research methodologies.</p></li><li><p><b>Track R&D expenses separately</b>. If possible, maintain a separate ledger for R&D costs, making it easier to verify during an audit.</p></li><li><p><b>Use time-tracking systems</b>. If wages are part of your claim, ensure employees <a target="_blank" rel="noopener noreferrer" href="https://remote.com/global-hr/time-and-attendance-tracking" tabindex="0" class="sc-e8e52cf3-6 etbnLB"><u>log the time</u></a> spent on R&D projects.</p></li><li><p><b>Retain supporting documents</b>. To help validate your claim, keep supporting records such as contracts, invoices, prototypes, test results, and meeting notes.</p></li></ul><h2 id="can-you-claim-the-federal-r-d-tax-credit-and-the-georgia-r-d-tax-credit-together">Can you claim the federal R&D tax credit and the Georgia R&D tax credit together?</h2><p>Yes, you can claim both the federal and Georgia R&D tax credits together. As mentioned, the federal credit applies to R&D expenses incurred anywhere in the US, while the Georgia credit is specific to expenses incurred within the state.</p><p>Note, though, that you must still meet the criteria for both.</p><p>To learn more about claiming the federal R&D tax credit, check out our in-depth guide below:</p><div class="sc-3e00b9dc-0 jhBKrR"><div class="sc-3e00b9dc-1 jQxumU"><img alt="link to How to claim the R&D tax credit in the US" loading="lazy" decoding="async" data-nimg="fill" style="position:absolute;height:100%;width:100%;left:0;top:0;right:0;bottom:0;object-fit:cover;color:transparent;border-radius:10px 0 0 10px;margin:0" sizes="100vw" srcSet="https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=640&q=75 640w, https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=750&q=75 750w, https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=828&q=75 828w, https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=1080&q=75 1080w, https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=1200&q=75 1200w, https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=1920&q=75 1920w, https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=2048&q=75 2048w, https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=3840&q=75 3840w" src="https://blog.remote.com/blog/_next/image?url=https%3A%2F%2Fimages.ctfassets.net%2F8naaccf28y0f%2FSusxQiZHqwDa8um2KGoNY%2F1fcb7cbb8dc639247c95281e415f8278%2Fremote_content_team_create_a_photo_of_two_engineers_one_male_on_bcc981ab-1cb8-4ffd-b1d7-5aec58ec89cf.png%3Ffm%3Dwebp%26w%3D666%26h%3D600%26fit%3Dfill&w=3840&q=75"/></div><div class="sc-3e00b9dc-2 eWafhX"><div class="sc-e8882eee-1 jFPwkZ"><div class="sc-e8882eee-2 gcpYSg"><a href="/blog/category/tax-compliance" class="sc-3e00b9dc-4 eYBHo">Tax and Compliance</a> —</div><div class="sc-e8882eee-3 eHSIGt">6 min</div></div><h4 class="sc-e8882eee-4 VLose"><a href="https://remote.com/blog/research-development-tax-credit" class="sc-3e00b9dc-4 eYBHo">How to claim the R&D tax credit in the US</a></h4><div class="sc-3e00b9dc-3 ftjLeb">The research and development (R&D) tax credit is a highly useful relief for many US businesses. Learn how to claim it in our in-depth guide.</div></div></div><h2 id="is-the-georgia-r-d-tax-credit-worth-it">Is the Georgia R&D tax credit worth it?</h2><p>If your business engages in any kind of innovative research, the Georgia R&D tax credit can potentially provide a major financial advantage. Not only does it help offset income tax, but it also offers a unique opportunity to apply unused credits to payroll taxes — making it especially useful for startups and growing businesses. However, to make the process efficient and simple, you need to keep full track of the compensation you’re paying to the employees who are contributing to your QRAs.</p><p>As a fully automated payroll system, <a target="_blank" rel="noopener noreferrer" href="https://remote.com/global-hr/global-payroll" tabindex="0" class="sc-e8e52cf3-6 etbnLB"><u>Remote Payroll</u></a> can provide you with this information quickly and accurately, making it more simple to calculate your eligible costs. Our system also enables your people to track their hours, improving the accuracy and validity of your claims.</p><p><b>To learn more about how we can help — and how we can simplify your entire payroll management system — </b><a target="_blank" rel="noopener noreferrer" href="https://remote.com/global-hr/global-payroll" tabindex="0" class="sc-e8e52cf3-6 etbnLB"><b><u>speak to one of our friendly experts</u></b></a><b> today.</b></p><div class="sc-4ea58b2a-11 JECvZ"><div class="sc-4ea58b2a-10 cxRDfB"><div class="sc-4ea58b2a-0 epZyzL"><h2 class="sc-4ea58b2a-1 fwxfkC">Trust G2’s multi-country payroll leader to keep you compliant</h2></div><div class="sc-4ea58b2a-3 gdKDFE"><div class="sc-4ea58b2a-4 iaGrIa"><div class="sc-4ea58b2a-2 sc-41f7d48b-0 jvSOAF kGudTq"><p>Hire and pay your global team with Remote and get access to our team of global taxation experts.</p></div><div class="sc-41f7d48b-1 kuDDYf"><a href="https://employ.remote.com/sign-up/" class="sc-232c646f-1 sc-232c646f-2 llRthT 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He was previously VP of Finance at Codacy.","nodeType":"text"}],"nodeType":"paragraph"}],"nodeType":"document"},"profilePicture":{"metadata":{"tags":[{"sys":{"type":"Link","linkType":"Tag","id":"TranslationDoneDEDE"}},{"sys":{"type":"Link","linkType":"Tag","id":"TranslationDoneFRFR"}},{"sys":{"type":"Link","linkType":"Tag","id":"TranslationDoneNLNL"}}],"concepts":[]},"sys":{"space":{"sys":{"type":"Link","linkType":"Space","id":"8naaccf28y0f"}},"id":"7thrwmibn9WbTyxWZJjyGf","type":"Asset","createdAt":"2022-10-28T12:13:55.082Z","updatedAt":"2023-05-29T16:59:37.606Z","environment":{"sys":{"id":"master","type":"Link","linkType":"Environment"}},"publishedVersion":27,"revision":18,"locale":"en-US"},"fields":{"title":"Pedro Barros headshot","description":"Pedro Barros headshot","file":{"url":"//images.ctfassets.net/8naaccf28y0f/7thrwmibn9WbTyxWZJjyGf/e43ce075f520c389f01109a39a0cb917/https___images.prismic.io_all-remote-content_fef58e1d-b417-479e-83a6-2233d627a791_Pedro_0001_-_Pedro_Barros.jpg","details":{"size":1718843,"image":{"width":4628,"height":3702}},"fileName":"https://images.prismic.io/all-remote-content/fef58e1d-b417-479e-83a6-2233d627a791_Pedro_0001+-+Pedro+Barros.jpg","contentType":"image/jpeg"}}},"href":"/author/pedro-barros","twitterUrl":"https://twitter.com/pedrocmb","linkedInUrl":"https://www.linkedin.com/in/pedromonteirobarros/","specialistCategories":[{"name":"Tax and Compliance","slug":"tax-compliance"},{"name":"Data Security \u0026 IP","slug":"data-security-ip"},{"name":"Global Payroll","slug":"global-payroll"}]}],"href":"https://remote.com/blog/research-development-tax-credit-georgia","image":{"src":"https://images.ctfassets.net/8naaccf28y0f/7q2lf3vBovOA2fr6oUnZDn/3c76b24e16e7f006357dfba3d487b5dc/pexels-nate-hovee-3069537-5063779__1_.jpg","width":960,"height":540.0625651720542,"$contentType":"image/jpeg","$nodeType":"asset","alt":"Wide shot skyline of Atlanta, Georgia.","url":"https://images.ctfassets.net/8naaccf28y0f/7q2lf3vBovOA2fr6oUnZDn/3c76b24e16e7f006357dfba3d487b5dc/pexels-nate-hovee-3069537-5063779__1_.jpg?fm=webp\u0026w=1920"},"tags":null,"__typename":"blogPost","body":[{"__typename":"blogPostContent","text":{"nodeType":"document","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"If your business conducts research and development activities in Georgia, you may be eligible for the state’s R\u0026D tax credit. This can help reduce your state tax liability and improve cash flow.","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"In this article, we’ll explain what exactly the R\u0026D tax credit is, who is eligible for it, and what you need to do to claim it. So let’s jump straight in.","marks":[],"data":{}}]},{"nodeType":"heading-2","data":{},"content":[{"nodeType":"text","value":"What is the Georgia R\u0026D tax credit?","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"The Georgia R\u0026D tax credit is a state incentive designed to encourage businesses to invest in research and development activities within the state. It allows eligible businesses to claim a credit of 10% of the increase in Georgia-based qualified research expenses (QREs) over a base amount.","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"This credit can be applied to offset your corporate income tax in Georgia and, if unused, a portion of your state payroll withholding taxes too.","marks":[],"data":{}}]},{"nodeType":"heading-3","data":{},"content":[{"nodeType":"text","value":"What’s the difference between the Georgia R\u0026D tax credit and the federal R\u0026D tax credit?","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"The key difference is that the federal credit applies to research conducted anywhere in the US, while the Georgia credit is limited to expenses incurred within the state.","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Additionally, the federal credit offers a higher potential credit rate (up to 20%), while Georgia’s credit is capped at 10% (although, as mentioned, there is a payroll tax offset option).","marks":[],"data":{}}]},{"nodeType":"heading-2","data":{},"content":[{"nodeType":"text","value":"What are the benefits of the Georgia R\u0026D tax credit?","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Claiming the Georgia R\u0026D tax credit offers your business several advantages, including:","marks":[],"data":{}}]},{"nodeType":"unordered-list","data":{},"content":[{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Reduced tax liability","marks":[{"type":"bold"}],"data":{}},{"nodeType":"text","value":". The credit directly offsets your company’s corporate income tax in Georgia, allowing you to lower your overall tax burden.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Payroll tax benefits","marks":[{"type":"bold"}],"data":{}},{"nodeType":"text","value":". If your company doesn’t have enough income tax liability to use the credit, you can apply it to offset up to 50% of your payroll withholding taxes in the state.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"More innovation","marks":[{"type":"bold"}],"data":{}},{"nodeType":"text","value":". By reducing the cost of R\u0026D, your business can reinvest in product improvements, new technologies, and market expansion.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Improved cash flow","marks":[{"type":"bold"}],"data":{}},{"nodeType":"text","value":". Tax savings free up funds that can be allocated toward growth, hiring, or additional R\u0026D efforts.","marks":[],"data":{}}]}]}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"If your business is engaged in a research-driven industry — such as technology, software, or manufacturing — the credit provides a tangible financial benefit that rewards innovation.","marks":[],"data":{}}]}]}},{"__typename":"blogPostContent","text":{"nodeType":"document","data":{},"content":[{"nodeType":"heading-2","data":{},"content":[{"nodeType":"text","value":"Who is eligible for the Georgia R\u0026D tax credit?","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"The Georgia R\u0026D tax credit is available to businesses of all sizes and industries, but you must meet specific eligibility requirements.","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"To qualify, your company must:","marks":[],"data":{}}]},{"nodeType":"unordered-list","data":{},"content":[{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Conduct research that is technological in nature, relying on principles from engineering, biology, chemistry, physics, or computer science.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Aim to develop new or improved products, processes, or software that enhance performance, reliability, or functionality.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Engage in experimental processes, including prototyping, testing, modeling, and analysis.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Incur QREs in Georgia, such as employee wages, supply costs, or third-party contract research.","marks":[],"data":{}}]}]}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"In most cases, this applies to companies in the technology, software, manufacturing, biotechnology, and aerospace fields. However, any business performing eligible research activities can apply.","marks":[],"data":{}}]},{"nodeType":"heading-2","data":{},"content":[{"nodeType":"text","value":"How do you apply for the Georgia R\u0026D tax credit?","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"To apply for the Georgia R\u0026D tax credit, your business must follow these steps:","marks":[],"data":{}}]},{"nodeType":"heading-3","data":{},"content":[{"nodeType":"text","value":"1. Identify your qualified research activities (QRAs)","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"First, review your internal projects and expenses to ensure they meet the eligibility criteria listed above.","marks":[],"data":{}}]},{"nodeType":"heading-3","data":{},"content":[{"nodeType":"text","value":"2. Calculate the credit amount","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"To calculate the credit amount, use the following formula:","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"10% x (current-year Georgia QREs - base amount)","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"In Georgia, the base amount is determined using a fixed formula similar to the federal R\u0026D tax credit calculation. It is based on your company’s historical research spending as a percentage of gross receipts, as follows:","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Georgia gross receipts × (average Georgia QREs from past 3 years / average Georgia gross receipts from past 3 years)","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"For instance, let’s say:","marks":[],"data":{}}]},{"nodeType":"unordered-list","data":{},"content":[{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Your average QREs in Georgia over the past 3 years were $250,000","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Your average gross receipts were $5.5 million","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Your current year QREs are $400,000","marks":[],"data":{}}]}]}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Using the formula, your base amount would be:","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"$5.5m x ($250k / $5.5m) = $250k","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"To calculate the credit, you would then use the first formula:","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"10% x ($400k - $250k) = $15,000","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Note that, if your company has no prior QRE history, the base amount may be considered zero, meaning the full 10% applies to your current-year QREs.","marks":[],"data":{}}]},{"nodeType":"heading-3","data":{},"content":[{"nodeType":"text","value":"3. File Georgia Form IT-RD","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"This form must be submitted along with your Georgia corporate tax return to claim the credit.","marks":[],"data":{}}]},{"nodeType":"heading-3","data":{},"content":[{"nodeType":"text","value":"4. Apply any unused credits","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"If the income tax liability is insufficient, your business can either carry forward your unused credits for up to 10 years — or, as mentioned, apply them to offset up to 50% of your payroll withholding taxes.","marks":[],"data":{}}]},{"nodeType":"heading-3","data":{},"content":[{"nodeType":"text","value":"5. Maintain proper documentation","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Ensure that you keep detailed records of your R\u0026D activities, expenses, and employee roles in case of an audit. Specifically, you should aim to:","marks":[],"data":{}}]},{"nodeType":"unordered-list","data":{},"content":[{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Maintain organized records","marks":[{"type":"bold"}],"data":{}},{"nodeType":"text","value":". Keep thorough documentation of your projects, expenses, employee activities, and research methodologies.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Track R\u0026D expenses separately","marks":[{"type":"bold"}],"data":{}},{"nodeType":"text","value":". If possible, maintain a separate ledger for R\u0026D costs, making it easier to verify during an audit.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Use time-tracking systems","marks":[{"type":"bold"}],"data":{}},{"nodeType":"text","value":". If wages are part of your claim, ensure employees ","marks":[],"data":{}},{"nodeType":"hyperlink","data":{"uri":"https://remote.com/global-hr/time-and-attendance-tracking"},"content":[{"nodeType":"text","value":"log the time","marks":[{"type":"underline"}],"data":{}}]},{"nodeType":"text","value":" spent on R\u0026D projects.","marks":[],"data":{}}]}]},{"nodeType":"list-item","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Retain supporting documents","marks":[{"type":"bold"}],"data":{}},{"nodeType":"text","value":". To help validate your claim, keep supporting records such as contracts, invoices, prototypes, test results, and meeting notes.","marks":[],"data":{}}]}]}]},{"nodeType":"heading-2","data":{},"content":[{"nodeType":"text","value":"Can you claim the federal R\u0026D tax credit and the Georgia R\u0026D tax credit together?","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Yes, you can claim both the federal and Georgia R\u0026D tax credits together. As mentioned, the federal credit applies to R\u0026D expenses incurred anywhere in the US, while the Georgia credit is specific to expenses incurred within the state.","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Note, though, that you must still meet the criteria for both.","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"To learn more about claiming the federal R\u0026D tax credit, check out our in-depth guide below:","marks":[],"data":{}}]}]}},{"__typename":"blogPostRelatedResources","relatedResources":[{"published":true,"date":"2024-11-20","formattedDate":"November 20, 2024","slug":"research-development-tax-credit","title":"How to claim the R\u0026D tax credit in the US","description":"The research and development (R\u0026D) tax credit is a highly useful relief for many US businesses. 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Not only does it help offset income tax, but it also offers a unique opportunity to apply unused credits to payroll taxes — making it especially useful for startups and growing businesses. However, to make the process efficient and simple, you need to keep full track of the compensation you’re paying to the employees who are contributing to your QRAs.","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"As a fully automated payroll system, ","marks":[],"data":{}},{"nodeType":"hyperlink","data":{"uri":"https://remote.com/global-hr/global-payroll"},"content":[{"nodeType":"text","value":"Remote Payroll","marks":[{"type":"underline"}],"data":{}}]},{"nodeType":"text","value":" can provide you with this information quickly and accurately, making it more simple to calculate your eligible costs. 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