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a. Seventeen and one-half percent of the first one hundred thousand dollars of the alternative excess research and development for the taxable year plus five and six-tenths percent of the alternative excess research and development for the taxable year in excess of one hundred thousand dollars. b. If a taxpayer has zero qualified research expenses in any one of the three taxable years preceding the taxable year for which the credit is determined, the amount of qualified research expenses for the taxable year multiplied by seven and one-half percent of the first one hundred thousand dollars plus two and four-tenths percent of qualified research expenses for the taxable year more than one hundred thousand dollars. 5. For purposes of this section: a. "Alternative excess research and development" means the amount of qualified research expenses which exceeds fifty percent of the average qualified research expenses for the three taxable years preceding the taxable year for which the credit is being determined. b. "Alternative simplified credit" means the computation set forth in section 41(c)(5) of the Internal Revenue Code [26 U.S.C. 41(c)(5)], except the term does not include qualified research expenses incurred outside the state of North Dakota. c. "Base amount" means base amount as defined in section 41(c) of the Internal Revenue Code [26 U.S.C. 41(c)], except it does not include research conducted outside the state of North Dakota. d. "Director" means the director of the department of commerce division of economic development and finance. e. "Primary sector business" has the meaning provided in section 1-01-49. f. "Qualified research" means qualified research as defined in section 41(d) of the Internal Revenue Code [26 U.S.C. 41(d)], except it does not include research conducted outside the state of North Dakota. g. "Qualified research and development company" means a taxpayer that is a primary sector business with annual gross revenues of less than seven hundred fifty thousand dollars and which has not conducted new research and development in North Dakota. h. "Qualified research expenses" means qualified research expenses as defined in section 41(b) of the Internal Revenue Code [26 U.S.C. 41(b)], except it does not include expenses incurred for basic research conducted outside the state of North Dakota. 6. The credit allowed under this section for the taxable year may not exceed the liability for tax under this chapter. 7. In the case of a taxpayer that is a partner, shareholder, or a member in a passthrough entity, the credit allowed for the taxable year may not exceed an amount separately computed with respect to the taxpayer's interest in the trade, business, or entity equal to the amount of tax attributable to that portion of the taxpayer's taxable income which is allocable or apportionable to the taxpayer's interest in the trade, business, or entity. 8. Except as provided in subsection 1, if the amount of the credit determined under this section for any taxable year exceeds the limitation under subsection 6, the excess may be used as a research credit carryback to each of the three preceding taxable years and a research credit carryover to each of the fifteen succeeding taxable years. The entire amount of the excess unused credit for the taxable year must be carried first to the earliest of the taxable years to which the credit may be carried and then to each successive year to which the credit may be carried and the amount of the unused credit which may be added under this subsection may not exceed the taxpayer's liability for tax less the research credit for the taxable year. A claim to carry back the credit under this section must be filed within three years of the due date or extended due date of the return for the taxable year in which the credit was earned. 9. A taxpayer that is certified as a qualified research and development company by the director may elect to sell, transfer, or assign all or part of the unused tax credit earned under this section. The director shall certify whether a taxpayer that has requested to Page No. 39