Incentives

Tax Incentives

EZ Employment Wage Credit - Credit against Federal taxes up to $3,000 for businesses for each year of EZ designation for every existing employee and new hire who lives and works in the Empowerment.

WOTC-Work Opportunity Tax Credit - Credit up to $2,400 against Federal taxes for businesses for each new hire from groups that have high unemployment rates.

WtW-Welfare to Work - Two-year credit against Federal taxes for businesses that hire long-term family assistance recipients. Credits up to $3,500 for the first year and $5,000 for the second year for each new hire.

Increased Section 179 Deduction - Allows businesses to claim increased Section 179 deduction (up to 20,000 in additional expensing increased to $35,000 for property acquired after Dec. 2001.

Environmental Cleanup Cost Deduction (Brownfields) - Businesses can elect to deduct qualified cleanup costs of hazardous substances in certain areas (brownfields) in the tax year the business pays or incurs the costs.

Possible Capital Gains Incentives such as:
Non Recognition of Gain on Sale of Empowerment Assets - Capital gain on EZAs (stock, partnership interests, and business property) of an Enterprise Zone business held for more than 1 year is not recognized if replacement EZA is acquired within 60 days.
Partial Exclusion of Gain on Sale of EZ Stock - Exclusion of 60 percent of the gain on sale of small business stock of a C Corporation that is an Enterprise Zone Business located in an EZ if the stock is held for at least 5 years.

Enterprise Facility Bonds - State and local governments can issue Enterprise Zone Facility Bonds to EZ Businesses to finance Qualified Zone Property.

New Market Tax Credit - Equity investors in qualified Community Development Entities(CDE's) can obtain a tax credit against Federal Taxes of 5 to 6 percent of the amount invested for each the years the investment is held, for up to 7 yrs of the credit period.

Low Income Housing Tax Credits - Ten-year credit against Federal taxes or owners of newly constructed or renovated rental housing who set aside a specified percentage of units for low-income persons for a minimum of 15 years.