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Minnesota Follows IRS R&D Credit Guidelines – Tax & Accounting Blog

The Minnesota Department of Revenue has announced that they will allow the use of GAAP expenditures for research and development credit calculations. By allowing this method, the department is following IRS guidelines.

In order for the guidelines to apply, the taxpayer must be:

  • a large business and international taxpayer filing a state business return; and
  • meet the federal requirements listed within the directive.

IRS Directive Taxpayers for Using GAAP Expense Rules for R&D Costs

The IRS directive, “Guidance for Allowance of the Credit for Increasing Research Activities under I.R.C. §41 for Taxpayers that Expense Research and Development Costs on their Financial Statements pursuant to ASC 730,” is available on the IRS website.

Recordkeeping Requirements

Additional information about the recordkeeping procedures for the research credit required by the IRS can be found at

The full text of the bulletin is available at:

Bulletin, Minnesota Department of Revenue, December 14, 2017

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Author: CCHTaxGroup

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