Tax Candi

I've always like saying "Kitty Hawk."  I'm sure it's a great town and, of course, the history is nothing to sneeze at, but it's as fun to say as IHOP's "Rooty Tooty Fresh N' Fruity."

Economic Incentives and Tax Credits don't typically have cool name. Normally they're pretty generic, like Job Creation Tax Credits. Sometimes, we get interesting acronyms, like the EDGE. But, to me, North Carolina's Article 3J incentives sounds vaguely mysterious and exciting. Granted, if you're a law nerd like me, it also sounds like a tribunal type. 

So, without further adieu...

Article 3J Tax Credits

North Carolina ranks its counties into three different tiers to determine which credits are available where, and for how much. North Carolina's Article 3J Tax Credits provide credits for three different business activities:

1) Job Creation,

2) Investment in Business Property, and

3) Investment in Real Property (tier 1 counties only).

These credits may be combined to offset up to 50% of state income and franchise tax liability, and unused credits may be carried forward for up to five years. (Well, the Investment in Real Property Credit can get a carryforward up to 20 years, but be prepared to invest over $150 million for that privilege.)

The job creation tax credit is worth up to $750 for tier 3 counties (must create at least 15 jobs), $5,00 for tier 2 counties (create at least 10 jobs) and $12,500 for tier 1 counties (create at least 5 jobs) WITH a $1,000 kicker for each job created in Urban Progress or Agrarian Growth Zones.

For investment in business property, businesses can get a tax credit (given in equal installments over a four year period) for investment in tangible personal property.  Businesses investing at least $2 million in a tier 3 county can receive a credit equal to $3.5% of the total investment, businesses investing at least $1 million in a tier 2 county can receive 5% of the investment and any investment in tier 1 county gets up to 7%.  Again, Urban Progress and Agrarian Growth Zones get a kicker of up to 7% of the investment.

And lastly, eligible businesses investing at least $10 million in real property and creating at least 200 new jobs in a tier 1 county are allowed a tax credit worth up to 30% of the real property investment.  The credit is given in equal installments over a 7 year period.

And all sorts of businesses are eligible for these credits, including motorsport racing teams!