The Kansas R&D tax credit, explained
Kansas offers a 10% R&D credit on spending growth, capped at 25% of the balance per year, but with no expiration and transfer rights.
Last verified July 2026 against Kansas Department of Revenue guidance.
The short answer
Yes, Kansas has a state R&D tax credit. It equals 10% of the amount by which a company's Kansas research spending in the current year exceeds the average of the prior three years.
How the Kansas credit works
The credit is nonrefundable, but Kansas puts a twist on the carryforward: a company can only use up to 25% of its total available credit, including any carryforward balance, in any single year. The rest keeps carrying forward, in 25% increments, with no expiration date.
Since 2023, any Kansas taxpayer can claim the credit, not just corporations, and new credits can be transferred or sold to another Kansas taxpayer if the company generating them has no current use.
How it stacks with the federal credit
Kansas' credit stacks with the federal R&D credit, though the state version rewards growth in spending rather than the total amount, so it works best for a company whose research budget is increasing year over year.
The federal credit is worth roughly 6% to 10% of qualified spend, and a startup under $5 million in revenue can apply up to $500,000 of it against payroll taxes each year, which does not depend on the Kansas growth calculation at all.
Example: a 6-person Kansas team with $480,000 in qualified salaries, up from a 3-year average of $350,000, could see a federal credit of roughly $34,000 to $48,000 on the full spend. The $130,000 increase over the average could also add a Kansas credit of about $13,000, though only 25% of that, roughly $3,250, is usable against Kansas tax in the first year, with the rest carrying forward.
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Eligibility and how to claim it
Kansas' credit is open to any individual or entity with qualified research expenses connected to Kansas activity, following the federal definition of qualified research as a base.
Companies calculate and claim the credit on Schedule K-53, filed with the Kansas income tax return. The 25% annual usage limit applies whether the amount comes from the current year or a prior carryforward balance.
A company with no current Kansas tax liability, or one that generated more credit than it can use, can transfer new credits to another Kansas taxpayer instead of letting them sit unused. The company's CPA handles this filing and any transfer paperwork with the Kansas Department of Revenue.
Official source: Kansas Department of Revenue.
Carryforward and deadlines
Kansas R&D credit carries forward indefinitely, but only 25% of the available balance can be used in any one tax year, so it can take several years to fully use a large credit.
Schedule K-53 is filed with the annual Kansas income tax return, on the same deadline as the return itself. There is no separate application.