NC-478: Summary of Tax Credits Limited to 50% of Tax (2025)
North Carolina · North Carolina DOR · Used for tax years 2025
Form NC-478 summarizes North Carolina tax credits subject to a 50% tax limit for 2025. It calculates the limit for franchise and income tax and reports the amount of each credit actually taken.
Who files this form
NC-478 summarizes tax credits subject to the 50% of tax limit for 2025. The form includes categories for individuals, C corporations, S corporations, partnerships, estates or trusts, and insurance taxpayers.
Most credits listed on the form have expired. Taxpayers may continue to claim remaining installments and carryforwards of prior years’ credits by completing Part 1.
What you'll need
Have the following information available to complete NC-478:
- The taxpayer’s name and Social Security number or federal employer ID number.
- The tax year’s beginning and ending dates, if not using calendar year 2025.
- The type of tax return filed, such as D-400, CD-405, CD-401S, D-403, D-407, or a listed insurance return.
- Available credit amounts by credit type, including remaining installments and carryforwards.
- Franchise and income tax due, and credit amounts not subject to the 50% limit.
- The amount of each credit actually taken in 2025.
How to file
The supplied form does not give a mailing address or e-filing directions. It provides these completion and submission directions:
- Enter the taxpayer’s identifying information, using capital letters for names, and fill in the circle for the tax return filed.
- Complete Part 1 and add lines 1 through 8 on line 9.
- In Part 2, subtract credits not subject to the limit from tax due, but do not enter less than zero. Multiply that result by 50%, then enter the lesser of line 9 or line 13 on line 14.
- In Part 3, enter each credit actually taken in 2025. Add lines 15 through 22 on line 23. The total cannot exceed line 14.
- Have the taxpayer or authorized agent sign and date the certification.
Submit originals only, not photocopies. Do not include the handwritten-forms instruction page.
Common mistakes
- Using red ink. Use blue or black ink instead.
- Adding dollar signs, commas, or other punctuation to handwritten entries.
- Printing with page scaling enabled. Set scaling to “none” and uncheck Auto-Rotate and Center.
- Printing on both sides of the paper.
- Submitting photocopies instead of originals, or mixing form types.
- Entering a negative amount on line 12. That line cannot be less than zero.
- Claiming a total on line 23 that exceeds line 14.
Questions people ask
Can I still claim credits that have expired?
The form says taxpayers may continue to claim remaining installments and carryforwards of prior years’ credits by completing Part 1.
How is the 50% limit calculated?
Part 2 subtracts credits not subject to the limit from franchise and income tax due, with a minimum result of zero. It then multiplies that result by 50%. Line 14 is the lesser of that amount or the total available credits on line 9.
Where do I show the credits actually taken in 2025?
Enter the amount of each credit in Part 3. The total on line 23 cannot exceed line 14.
Who signs NC-478?
The taxpayer or an authorized agent signs and dates the form, certifying that the taxpayer meets the credit requirements and that the information on the NC-478 series forms and accompanying schedules is accurate and complete to the best of their knowledge.