MCL 208.1405 provides a credit against the MBT equal to 1.90% of a taxpayers "research and development expenses" for the 2009 tax year and each tax year after 2009. The credit is for 1.52% of research and development expenses for the 2008 tax year. The credit combined with credits under section 403 (Compensation Credit and Investment Tax Credit) cannot exceed 65% of a taxpayer's tax liability before the surcharge under section 281. Research and development expenses are defined by reference to Internal Revenue Code Section 41(b) that describes "qualified research expenses" as "the sum of ... in-house research expenses and contract research expenses." In house research expenses are defined, in pertinent part, as;

i) any wages paid or incurred to an employee for qualified services performed by such employee,
ii) any amount paid or incurred for supplies used in the conduct of qualified research, and
iii) under regulations prescribed by the Secretary, any amount paid or incurred to another person for the right to use computers in the conduct of qualified research.
IRC 41(b)(2)(A).

Contract research expenses are "65 percent of any amount paid or incurred by the taxpayer to any person (other than an employee of the taxpayer) for qualified research." IRC 41(b)(3)(A). The MBT credit is available for a percentage of the sum of these expenses.