Enhanced Minnesota R&D Tax Credit

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Black Line Group, a leading provider of R&D Tax Credit services, is pleased to announce that as a part of the Minnesota “Jobs Bill” signed into law on April 1st by Governor Pawlenty, there are some significant enhancements to the Minnesota State Research and Development (R&D) Tax Credit. For companies with qualifying R&D activities, the highlights are as follows:

  • S corps, Partnerships and Individuals can now claim a Minnesota State R&D Tax Credit. Previously, only C corps could benefit.
  • The tax credit has been increased from 5% to 10% of the first $2,000,000 of qualified research expenses over the base amount, and 2.5% on all of such excess expenses over $2,000,000.
  • The Minnesota State R&D Tax Credit is now Refundable for taxable years beginning after December 31, 2009. Now, even companies without tax liabilities may be able to benefit!

The definition of Research and Development (R&D) is much broader than people realize. Activities and costs associated with developing or improving a product and/or process can potentially generate both federal and Minnesota State R&D Tax Credits. Manufacturers of all kinds, including those that design and develop their own products, as well as those companies (i.e. metal stampers and fabricators, precision machinists, mold builders and plastic injection molders) that make parts for their larger OEM customers, often do not know or believe that they are doing R&D. In addition, there can be significant R&D going on in software development and technology companies. For more information about Black Line Group or questions about these important changes, contact Scott Schmidt at 763-550-0111, via email at or visit our website at

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