Employment Tax Credit

A company may qualify for a direct credit of the Empowerment Zone business’ federal income tax liability – up to $3,000 per business employee living in the Zone.

A qualified employee must perform his or her services within the Empowerment Zone. A qualified employer is eligible to take 20% of the first $15,000 of each employee’s wage in a federal tax credit with no limits on the number of employees.

Credits are available through December 31, 2009. Unused credits can be carried forward up to 20 years.

Credits are not available for certain farms, owners, or family members.

Tax Exempt Bond Financing

State or local governments can issue enterprise zone facility bonds (tax exempt) to raise funds to provide an enterprise zone business with capital for qualified zone properties. This typically reduces the cost of capital by 1.5% to 2.5% from conventional financing.

Increased Section 179 Deduction

A qualified business may be able to claim an increased section 179 deduction on qualified zone property put into service within the Empowerment Zone. This increase may be as much as $35,000 per year.

For more information on any of the above described tax incentives, please contact the Empowerment Zone office.