The Qualifying Therapeutic Discovery Project tax credit is provided under new section 48D of the Internal Revenue Code (IRC), enacted as part of the Patient Protection and Affordable Care Act of 2010 (P.L. 111-148). The credit is a tax benefit targeted to therapeutic discovery projects that show a reasonable potential to:
- Result in new therapies to treat areas of unmet medical need or prevent, detect or treat chronic or acute diseases and conditions,
- Reduce the long-term growth of health care costs in the United States, or
- Significantly advance the goal of curing cancer within 30 years.
Allocation of the credit will also take into consideration which projects show the greatest potential to create and sustain high-quality, high-paying U.S. jobs and to advance U.S. competitiveness in life, biological and medical sciences.
The credit is only available to taxpayers with no more than 250 employees. The credit covers up to 50 percent of a taxpayer's qualified investment. To provide an immediate boost to U.S. biomedical research, the credit is available for qualified investments made or to be made in 2009 and 2010. To claim the credit, a taxpayer must apply for certification of its qualified investments. The amount of the credit which a taxpayer may be allocated will be limited to a maximum of $5 million per taxpayer, and the total amount of credits available to all taxpayers is limited to $1 billion.
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