KPMG report: Michigan R&D credit

Eligible taxpayers may claim R&D credits for qualified research expenses.

For tax years beginning on or after January 1, 2025, eligible taxpayers may claim a tax credit against the Michigan corporate income tax, or against Michigan withholding tax for flow-through entities, equal to 3% of a taxpayer’s qualified research expenses (QREs) up to the base amount, plus an additional 10% of QREs above the base amount for large taxpayers (250 or more employees) or 15% of QREs above the base amount for small taxpayers (fewer than 250 employees).

Taxpayers may also claim an additional 5% credit (up to $200,000 per year) for QREs that are related to research conducted in collaboration with a Michigan public university or independent nonprofit college or university, provided the collaboration is documented by a written agreement.

Read a February 2026 report prepared by KPMG LLP that discusses the Michigan research and development (R&D) credit.

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KPMG report: Michigan R&D credit

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