CT-1120 SF: Service Facility Credit (2025)

Who files this form

Corporations use Form CT-1120SF to claim the Service Facility Tax Credit against Connecticut Corporation Business Tax.

To qualify:

• The service facility must be outside an Enterprise Zone and in a targeted investment community. A facility inside an Enterprise Zone cannot qualify.
• A written application must have been submitted to and approved by the Commissioner of the Department of Economic and Community Development (DECD).
• The corporation must meet the employment criteria in Schedule A. If Line 3, new employees in Connecticut, is zero or less, the corporation is not eligible.
• The ten-year credit period must have begun before the corporation’s 2018 income year. The credit is being phased out.

What you'll need

Have the following information ready to complete the 2025 form:

• Corporation name, Connecticut Tax Registration Number, income-year beginning and ending dates, and DECD eligibility certificate number, if applicable.
• The highest number of Connecticut employees in the year before the formal DECD certification application.
• Employee counts for Connecticut and the service facility during 2025.
• Average monthly net book values for property, machinery, and equipment at the eligible facility and across Connecticut, plus gross rents payable during the income year for rented property and equipment. The instructions value rented property and equipment at eight times gross rents.
• Wages, salaries, and other compensation paid during the income year for positions directly attributable to the eligible facility and for all Connecticut employees.
• Total tax from Form CT-1120, Schedule C, Line 1, or the credit claimant’s total tax from the appropriate column of Form CT-1120CU, Part I, Line 9.
• Form CT-1120K, where the computed credit is entered in Part I-B, Column A.

Common mistakes

• Using the wrong year’s form. Each form is year-specific, and the correct year must be used.
• Completing the form in ink other than blue or black, or using staples. The form permits only blue or black ink and says not to use staples.
• Claiming the credit for a facility inside an Enterprise Zone. Such a facility cannot qualify.
• Claiming the credit when the ten-year credit period began in the 2018 income year or later. The form prohibits this.
• Carrying the credit forward or back. Neither is allowed.
• Claiming a partial-year credit when the facility stops qualifying or the taxpayer stops occupying the property. Credit entitlement ends, with no prorated credit for that income year.

Questions people ask

How long does the credit last?

The credit period is ten years. It starts with the first full income year after the year the eligibility certificate was issued and continues for the next nine income years. The period must have begun before the corporation’s 2018 income year.

How is the number of new employees at the facility calculated?

First, subtract the highest Connecticut employee count in the year before the formal DECD application from the Connecticut employee count during 2025. Then enter the smaller of that result or the facility’s 2025 employee count on Schedule A, Line 5.

What credit percentage applies?

The percentage depends on the number of new employees working at the service facility, determined on Schedule A, Line 5:

• 300–599: 15%
• 600–899: 20%
• 900–1,199: 25%
• 1,200–1,499: 30%
• 1,500–1,999: 40%
• 2,000 or more: 50%

The percentage applies to the portion of Connecticut Corporation Business Tax allocated to the eligible service facility, not automatically to the corporation’s entire tax.

Can unused credit be carried to another year?

No. The form allows neither a carryforward nor a carryback.

Where do I report the calculated credit?

Enter the credit on Form CT-1120SF, Schedule B, Line 8, and on Form CT-1120K, Part I-B, Column A.

Official sources

• https://portal.ct.gov/-/media/drs/forms/2025/corp/ct-1120sf_1225.pdf