The Florida R&D tax credit, explained
Florida offers a 10% state R&D credit, but only for target industry businesses that win a slot in the March application window.
Last verified July 2026 against Florida Department of Revenue guidance.
The short answer
Florida has a state R&D tax credit, but it is narrow. Only corporations in target industries qualify, such as software, biotech, aviation, and manufacturing. Companies must first get a certification letter from the Florida Department of Commerce before they can apply for the credit.
How the Florida credit works
The credit equals 10% of qualified research spending in Florida above a base amount tied to the company's own research history. It is not refundable. Unused credit carries forward for 5 years.
The state sets a hard statewide cap of $9 million a year. If total requests exceed the cap, the Department of Revenue prorates every approved credit down. That means the actual dollar amount a company receives can be smaller than what it calculated.
How it stacks with the federal credit
The Florida credit stacks with the federal R&D credit. Companies claim both on the same qualified research expenses, since Florida uses the federal definition of qualified research as the starting point.
Example: a Florida software company with 8 engineers and an average salary of $110,000 spends $880,000 a year on qualified research. If its base amount from prior years is $550,000, the excess is $330,000. At Florida's 10% rate, that is a $33,000 state credit, assuming the company wins an allocation in the March window. The same $880,000 in spending can also generate a federal credit of roughly $53,000 to $88,000, using the typical 6% to 10% range. A profitable company under $5 million in revenue can apply up to $500,000 of that federal credit directly against payroll taxes instead of waiting to owe income tax.
Because the Florida credit is capped and awarded through a competitive window, treat it as a bonus on top of the federal credit, not a guaranteed number. Build the federal claim first, since it is not capped or restricted by industry.
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Eligibility and how to claim it
Eligibility starts with industry. Florida limits this credit to target industries: manufacturing, life sciences, information technology, aviation and aerospace, homeland security and defense, and a handful of other sectors named by the Department of Commerce. A generic services or retail business does not qualify, even with real research spending.
The company applies through the Florida Department of Revenue's online system during a one week window each March, for expenses from the prior calendar year. Approval requires attaching a certification letter from the Department of Commerce confirming target industry status.
Once certified and approved, the company claims its allocated credit on its Florida corporate income tax return, Form F-1120. Claimship prepares the underlying research study and expense documentation. The company's CPA handles the application, certification paperwork, and tax filing.
Official source: Florida Department of Revenue.
Carryforward and deadlines
The application window opens for one week each March, covering qualified research expenses from the prior calendar year. Miss the window and the credit for that year is gone. Unused approved credit carries forward for 5 years.
Because certification from the Department of Commerce has to happen before the DOR application, companies planning to claim this credit should start the target industry certification process well before March.