HB 1121 -- Qualified Research Tax Credits

Sponsor:  Harris (23)

This bill authorizes a tax credit for qualified research costs
paid by a corporation in a targeted industry.  The tax credit
will be equal to:

(1)  10% of the qualified research costs incurred by any
corporation in a targeted industry;

(2)  12.5% of the qualified research costs incurred by any new
corporation in a targeted industry;

(3)  15% of the qualified research costs incurred if an existing
corporation in a targeted industry incurs the costs in consortium
or in partnership with any public university, public college, or
public community college in Missouri; and

(4)  17.5% of the qualified research costs incurred if a new
corporation in a targeted industry incurs the costs in consortium
or in partnership with any public university, public college, or
public community college in Missouri.

A company that is deemed to be a new corporation cannot maintain
this designation for more than five years from when it was
incorporated in or relocated to Missouri.

"Qualified research" is defined and will not include any
research:

(1)  Conducted after commercial production of the business
component has begun;

(2)  Related to the adaptation of an existing business component
to a particular customer's requirements;

(3)  Related to the reproduction of an existing business
component, in whole or in part, from a physical examination of
the business component itself or from blueprints or publicly
available information;

(4)  Related to surveys, studies, market testing, development,
advertising, or ordinary testing or inspection for quality
control;

(5)  Related to computer software which is developed by the
corporation for internal use; or

(6)  Funded by a grant, contract, or by another person or
government entity.

The bill defines "target industry" and specifies what must be
disclosed to the Department of Economic Development by a
corporation that receives qualified research tax credits.  The
department must prepare an annual report regarding all tax
credits issued in the previous calendar year and submit it to the
President Pro Tem of the Senate and Speaker of the House of
Representatives by July 1 each year.  Required elements of the
report are specified.

The provisions of the bill will expire six years from the
effective date.

Missouri House of Representatives
94th General Assembly, 1st Regular Session
Last Updated July 25, 2007 at 11:21 am