INSTRUCTIONS: ARIZONA CREDIT FOR INCREASED RESEARCH ACTIVITIES (Form 308)

Arizona businesses may obtain credit for increased research activities by filing a form 308. This document can be obtained from the website of the Arizona Department of Revenue.

Arizona Credit For Increased Research Activities 308 Step 1: If not filing for the tax year listed on the form, enter the beginning and ending dates of your fiscal year.

Arizona Credit For Increased Research Activities 308 Step 2: Enter your name as entered on your 120, 120A, 120S, 120X or 165 return.

Arizona Credit For Increased Research Activities 308 Step 3: Enter your employer identification number.

Arizona Credit For Increased Research Activities 308 Step 4: Part I concerns qualification for refund of current taxable year's excess credit. Complete lines 1 and 2 as directed.

Arizona Credit For Increased Research Activities 308 Step 5: Part II concerns calculation of your current taxable year's credit. Complete lines 3 through 19 as directed.

Arizona Credit For Increased Research Activities 308 Step 6: If line 19 is $2,500,000 or smaller, complete line 20 but ignore lines 21 through 23. If line 19 is greater than $2,500,000, do not complete line 20 but complete lines 21 through 23.

Arizona Credit For Increased Research Activities 308 Step 7: Enter the amount from line 20 or line 23 as applicable on line 24. This figure is your current year's credit for increased research activities.

Arizona Credit For Increased Research Activities 308 Step 8: Part III concerns S Corporation Credit Election and Shareholder's Share of Credit. Complete lines 25 through 29 as directed.

Arizona Credit For Increased Research Activities 308 Step 9: Part IV concerns each partner's credit share. This must be completed separately for each partner.

Arizona Credit For Increased Research Activities 308 Step 10: Only complete Part V if "Yes" is checked on line 1.

Arizona Credit For Increased Research Activities 308 Step 11: Part VI concerns available pre-2003 credit carryovers.

Arizona Credit For Increased Research Activities 308 Step 12: Part VII concerns available post-2002 credit carryovers.

Arizona Credit For Increased Research Activities 308 Step 13: Part VIII concerns limitation of pre-2003 credit carryovers.

Arizona Credit For Increased Research Activities 308 Step 14: Part IX concerns limitation of post-2002 credit carryovers.

Arizona Credit For Increased Research Activities 308 Step 15: Part X provides instructions for calculation of your final total nonrefundable credit.