AN ACT ESTABLISHING A RESEARCH AND DEVELOPMENT TAX CREDIT FOR PASS-THROUGH ENTITIES.

Plain English Breakdown

The official source material does not provide specific details about when the tax credit will be available or how many businesses will qualify and use it.

Act to Create Tax Credit for Business Research

This act establishes a six percent personal income tax credit for pass-through entities based on their research and development expenditures.

What This Bill Does

• Establishes a new tax credit against the personal income tax for pass-through entities, which is equal to six percent of their research and development expenses incurred during the taxable year.

Who It Names or Affects

• Pass-through entities that incur research and development expenses

Terms To Know

Pass-Through Entity

A type of business where profits and losses are reported on the owners' personal tax returns.

Research and Development Expenses

Expenses incurred by businesses for activities aimed at creating new or improved products, services, or technologies.

Limits and Unknowns

• The bill does not specify the effective date of this tax credit.
• It is unclear how many pass-through entities will qualify and utilize this credit.

Official Summary Text

To establish a credit against the personal income tax in the amount of six per cent of the research and development expenses paid or incurred for a taxable year by pass-through entities.

Current Bill Text

LCO No. 428 1 of 1

General Assembly Proposed Bill No. 5059
February Session, 2026 LCO No. 428

Referred to Committee on FINANCE, REVENUE AND
BONDING

Introduced by:
REP. CANINO, 65th Dist.

AN ACT ESTABLISHING A RESEARCH AND DEVELOPMENT TAX
CREDIT FOR PASS-THROUGH ENTITIES.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:

That the general statutes be amended to establish a credit against the 1
personal income tax in the amount of six per cent of the research and 2
development expenses paid or incurred for a taxable year by pass -3
through entities. 4
Statement of Purpose:
To establish a credit against the personal income tax in the amount of
six per cent of the research and development expenses paid or incurred
for a taxable year by pass-through entities.