CT-1120 MEC: Machinery and Equipment Expenditure Credit (2024)
Connecticut · Connecticut DRS · Used for tax years 2024
Form CT-1120 MEC calculates Connecticut’s Machinery and Equipment Expenditures Tax Credit for 2024. It reports a corporation’s qualifying expenditures for 2024 and 2023, its full-time permanent employee count, and the resulting credit.
Who files this form
Corporations use Form CT-1120 MEC to claim a credit for an increase in qualifying machinery and equipment expenditures over the preceding income year. The machinery and equipment must be acquired for and installed in a Connecticut facility.
For the 2024 credit, qualifying expenditures must exceed those for 2023. The credit rates are:
- 250 or fewer full-time permanent employees in Connecticut: 10% of the increase.
- 251 to 800 full-time permanent employees in Connecticut: 5% of the increase.
If 2024 expenditures minus 2023 expenditures are zero or less, the corporation is not eligible for this credit.
What you'll need
To complete the form, have:
- Schedules showing Connecticut machinery and equipment expenditures incurred during the 2024 and 2023 income years. Attach a schedule for each year's amount.
- The number of full-time permanent employees for 2024.
- The corporation's name, Connecticut Tax Registration Number, and income-year beginning and ending dates.
- Form CT-1120K, where you also enter the calculated credit in Part I-B, Column A.
Common mistakes
- Using the wrong year's form: Each form is year specific. Use the correct year's form.
- Using ink other than blue or black: Complete this form in blue or black ink only.
- Stapling the form: Do not use staples.
- Claiming the same expenditures for another credit: Expenditures claimed for this credit cannot also be claimed for any other Corporation Business Tax credit.
- Claiming a credit without an increase: If Line 3 is zero or less, the corporation is not eligible for the credit.
Questions people ask
How do I calculate the 2024 credit?
Subtract qualifying 2023 expenditures from qualifying 2024 expenditures. If the result is positive, multiply it by the applicable rate: 10% for 250 or fewer full-time permanent employees in Connecticut, or 5% for 251 to 800. Enter the credit on Line 6 and on Form CT-1120K, Part I-B, Column A.
Who counts as a full-time permanent employee?
An employee whose wages, salary, or other compensation is paid in Connecticut and whose employment requires an average of at least 35 hours of service each week for at least eight consecutive weeks.
Can machinery parts and control devices qualify?
Yes. The machinery definition includes component parts, replacement and repair parts, and devices used or required to control, regulate, or operate machinery, including computers and data processing equipment. Qualifying expenditures must be for machinery and equipment acquired for and installed in a Connecticut facility.
Do furniture, vehicles, or construction equipment qualify?
Furniture and fixtures, automobiles, and other property used for transportation are excluded from both the machinery and equipment definitions. Construction equipment is also excluded from the equipment definition.
Where can I find more information?
The form directs you to the Guide to Connecticut Business Tax Credits on the Department of Revenue Services website at portal.ct.gov/DRS.