What changes were made to the inventory tax credit?

For entities taxed as C-corporations for federal income tax purposes, the inventory tax credit has been sunset, effective for taxable periods beginning on or after July 1, 2026. C-corporations can continue to claim their carryforwards for the remainder of the initial 10-year period, plus an additional 5 years for credits which did not expire prior to January 1, 2025. Credits earned by a C-corporation are non-refundable for periods beginning on or after January 1, 2025.

For taxable periods beginning on or after July 1, 2026, the inventory tax credit can only be taken against individual income taxes, including credits from pass-through entities.