Tax Candi

Ohio is home to a number of interesting things - the Rock and Roll Hall of Fame, a pennant-shaped state flag, and the first traffic signal system in America.   They also have a robust economic development program for investments, job retention and job creation; so, let's take a look at Ohio's...

Job Creation Tax Credit

The key things about Ohio's the Job Creation Tax Credit ("JCTC") is a refundable tax credit for new full-time jobs created pursuant to an application to and subsequent agreement with the Tax Credit Authority.  Yes - refundable (Excellent in this economy).  The credit is equal to an agreed-to percentage of the new employees' Ohio income tax withholding during the taxable year. 

To be eligible, a company must create at least 25 net new jobs and their salaries must be 150% of the federal minimum wage (so, $11.25).

The proposed municipality must provide an incentive as well.  As part of the required location portion, the municipality may also grant a nonrefundable tax credit against the municipal income tax (double bonus!).

Interested parties must contact and provide a rather lengthy application to Ohio's Department of Development.

New Mexico is home to many cool things: skiing, sun, and miraculous stairs.

If these unique attractions aren't enough to entice you to the Land of Enchantment, New Mexico offers the...

High Wage Jobs Tax Credit

New Mexico will give qualifying companies 10% of the value of wages+benefits for jobs paying above $28,000 per year in rural areas and $40,000 per year in more urban areas.  (Note: "more urban" is relative.  In this case, it means "Area with population in excess of 40,000 persons).  The credit does have a limit.  It cannot exceed $12,000 per year, per job.

However, the credit is available for 4 years and is refundable!

Interested companies will need to file annual certificates for each of the applicable employees, but the paperwork should be well worth it!

During my time in Indiana, I noticed there is a bit of rivalry between Illinois and Indiana. This rivalry is apparent in many places-- Bears vs. Colts, U of I vs. IU, and apparently, EDGE tax credit vs. EDGE tax credit.

My inaugural post was about the Illinois EDGE program. And while I am loathe to cast my current home state in anything but a pleasant light, Indiana did the EDGE first, and it does it better (better = refundable).

Indiana's EDGE offers eligible companies a refundable tax credit against income tax liability for the creation of new jobs. "Job Creation" means jobs that were not previously performed by employees of the company in Indiana. The company must be able to show that the receipt of the tax credit is a major factor in the decision to locate in Indiana, and must maintain operations in Indiana for at least two years beyond the term of the company’s EDGE award (in other words, up to 12 years).

The EDGE Tax credit is calculated as a percentage of payroll tax withholding for net new Indiana jobs, and may be awarded for up to 100% of the projected withholdings attributable to the company’s Indiana project. The tax credit is awarded for up to 10 years.

Interested companies must apply to Indiana Economic Development Corporation (IEDC).  The amount and duration of the credit is determined by negotiations the IEDC.

I have been craving crepes from my favorite bistro in Chicago, which inspired today's incentive: 

Crepe --> French Food --> French Quarter --> New Orleans --> Louisiana -->

And vióla, Louisiana Enterprise Zone Jobs Incentive!

This program provides a one-time Income and/or Franchise Tax job tax credit to a business increasing its workforce in Louisiana.  The company must increase its site employment by 10% within first 12 months OR create a minimum of 5 net new jobs within first 24 months. Of those jobs hired, at least 35% of its net new jobs must meet at least one of four targeted groups. 

The amount of the tax credit is $2,500 for each certified net new job created. AND, if the job requirement is met, the company may also be able to take advantage of either:

1) a Sales/Use Tax Rebate for taxes paid on materials, furniture, fixtures, machinery and equipment purchased and used exclusively in the Enterprise Zone site; OR

2) a 1.5% Refundable Investment Tax Credit for capitalized investment.

Note a couple of interesting things about this Enterprise Zone program -- unlike other states, Louisiana does not require new capital investment.  Also, the business does not need to be located within an Enterprise Zone, it must only create new jobs in an Enterprise Zone.

Interested companies must submit an Advance Notification Form prior to and an Application within 90 days after the project start date.

Check out the pretty sweet and easily searchable Lousiana Economic Development website!

Qualified Target Industry Tax Refund Program

High on the list of "Places I'd Like to Visit in February" is Florida!

The State of Florida is very business friendly and offers a number of attractive incentives. The state's job creation tax credit is known as the Qualified Targeted Industry ("QTI") Tax Refund. Companies in "targeted" high-growth industries may receive refundable tax credits of up to $3,000 per new job created.  (Note: Eligible businesses must create at least 10 new jobs paying 115% of the project county's average annual wage.)

Bonus credit amounts: Businesses expanding in an Enterprise Zone or rural county can receive up to $6,000. Additional "per job" bonuses are available for businesses paying 150% or 200% of the project county's average annual wage or locating in a designated Brownfield.

Limitations:

1) There is a cap of $5 million of refunds per applicant; and

2) No more than 25% of the total annual refund approved may be paid out any single fiscal year.

Targeted industries vary depending on county, though there are common themes throughout the state, such as regional and national headquarters, telecommunications, research and development, and green energy projects.

Update on Tuesday, August 18, 2009 at 9:49AM by Jennifer Crane

From the Jacksonville Business Journal, an example of how generous Florida can be with it's economic development incentives. 

The Jacksonville Economic Development Commission has approved a $20.2 million incentive package for Saft America Inc. to build a lithium ion battery plant

This incentives package included the QTI, as well as a Recaptured Enhanced Value Grant, a grant from the Countywide Economic Development Fund, and a a five-year public service tax exemption.