The Oregon R&D tax credit, explained
Oregon has a 15% R&D credit, but only for certified semiconductor companies. Other industries have no state credit.
Last verified July 2026 against Business Oregon and Oregon Department of Revenue guidance.
The short answer
Does Oregon have an R&D tax credit? Yes, but only for the semiconductor industry. Oregon created this credit in 2023 to attract chip-related research, and it took effect for tax years starting January 1, 2024.
How the Oregon credit works
The credit equals 15% of qualified research expenses performed in Oregon by a certified semiconductor company. Unlike the federal credit, it does not require calculating a historical base amount. It is partially refundable on a sliding scale tied to how many Oregon employees the company has: 75% refundable for companies under 150 employees, 50% for 150 to 499, 25% for 500 to 2,999, and fully nonrefundable for companies at 3,000 or more.
Companies outside the semiconductor industry, including most software and hardware startups, do not qualify for any Oregon state R&D credit. They rely on the federal credit alone.
How it stacks with the federal credit
For a certified semiconductor company, Oregon's 15% credit stacks on top of the federal credit, which runs roughly 6% to 10% of qualified spend. Together they can offset a meaningful share of a chip startup's research payroll.
Example: a Hillsboro semiconductor design startup with 40 employees and $6.5 million in qualified Oregon research expenses could see a federal credit near $455,000 at a 7% effective rate, plus an Oregon credit of $975,000 at 15%. Since the company has under 150 employees, 75% of the Oregon credit, about $731,000, could come back as a refund even without much income tax liability, with the rest carried forward.
For any other Oregon industry, only the federal credit applies. A software team of similar size would still get the federal benefit, including the payroll tax offset of up to $500,000 a year for companies under $5 million in revenue, just without the Oregon add-on.
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Eligibility and how to claim it
To claim Oregon's credit, a company must first register and get annual certification from Business Oregon as a semiconductor company doing qualified research in the state. Certification applications are due each year, and materials submitted are kept confidential.
Once certified, the credit is claimed on the Oregon tax return under ORS 315.518 through 315.522, working with the Oregon Department of Revenue's guidance. The company's CPA handles that filing.
Non-semiconductor companies do not need to do anything with Business Oregon. They claim the federal credit on Form 6765, prepared with help from a service like Claimship, and their CPA files it with the IRS and passes the benefit through to the Oregon return.
Official source: Business Oregon and Oregon Department of Revenue.
Carryforward and deadlines
Business Oregon certification has an annual deadline of October 15 for the following tax year. Missing it means missing that year's credit even if the research qualifies.
Unused, nonrefundable Oregon credit amounts carry forward, but only through tax year 2029, when the program is scheduled to sunset under current law. There is also a $4 million annual cap per taxpayer and statewide biennial caps that can limit how much gets paid out.