Connecticut Machinery and Equipment Expenditure Credit

Machinery and Equipment Expenditure Credit
Form CT-1120 MEC
Department of Revenue Services
State of Connecticut
(Rev. 12/23)

2023

Form CT-1120 MEC

Machinery and Equipment Expenditures Tax Credit

For Income Year Beginning:________________________ , 2023 and Ending:_________________________ ,__________ .
Connecticut Tax Registration Number

Corporation name

Complete this form in blue or black ink only. Do not use staples.
Please note that each form is year specific. The correct year’s form
must be used.
Use Form CT‑1120 MEC to claim the credit available under Conn.
Gen. Stat. § 12‑217o for the incremental increase in the amount
spent by a corporation on machinery and equipment.
Expenditures claimed for this credit cannot be claimed in connection
with any other Corporation Business Tax credit.

Definitions
Qualifying expenditures are any expenditures that fall within
the definition of machinery and equipment acquired for and
installed in a facility in Connecticut.
Machinery is the basic machine itself, including all of its
component parts such as belts, pulleys, shafts, moving parts,
operating structures, replacement and repair parts, whether
purchased separately or in conjunction with a complete machine
and regardless of whether the machine or component parts are
assembled by the taxpayer or another related party; and all
equipment or devices used or required to control, regulate, or
operate the machinery, including without limitation, computers and
data processing equipment. Furniture and fixtures, automobiles,
or other property used for transportation are not machinery.

Full-time permanent employee is an employee whose wages,
salaries or other compensation is paid in Connecticut and whose
employment requires an average of 35 hours or more of service
each week for at least eight consecutive weeks.

Tax Credit Percentages
In the case of a corporation that has not more than 250 full‑time
permanent employees in Connecticut, the credit is equal to 10%
of the amount spent on machinery and equipment acquired for
and installed in a facility in Connecticut that exceeds the amount
spent by the corporation during the preceding income year for such
expenditures.
In the case of a corporation that has between 251 and 800 full‑time
permanent employees in Connecticut, the credit is equal to 5% of
the amount spent by the corporation on machinery and equipment
acquired for and installed in a facility in Connecticut that exceeds
the amount spent by the corporation during the preceding income
year for such expenditures.

Additional Information
See the Guide to Connecticut Business Tax Credits available
on the Department of Revenue Services (DRS) website at
portal.ct.gov/DRS.

Equipment is a device separate from machinery but essential
to the business. Repair and replacement parts for equipment
also qualify for the credit under the same terms as provided
for parts purchased for machinery. Furniture and fixtures,
automobiles, construction equipment, or other property used
for transportation are not equipment.
Facility means any plant, building, or other real property
improvement used by the corporation in its trade or business.

Credit Computation
1.

Enter the amount of Connecticut machinery and equipment expenditures incurred during the 2023
income year. Attach schedule.

1.

2.

Enter the amount of Connecticut machinery and equipment expenditures incurred during the 2022
income year. Attach schedule.

2.

3.

Balance: Subtract Line 2 from Line 1. If zero or less, the corporation is not eligible for this credit.

3.

4.

Enter the number of full-time permanent employees for 2023.

4a.

If Line 4 is 250 or fewer, enter 10% (.10) on Line 5.

4b.

If Line 4 is at least 251, but not more than 800, enter 5% (.05) on Line 5.

5.

Enter the applicable percentage (5% or 10%) from Line 4a or Line 4b.

5.

6.

Tax credit: Multiply Line 3 by Line 5. Enter here and on Form CT-1120K,
Part I-B, Column A.

6.

4.

Visit us at portal.ct.gov/DRS for more information.