Because most of us are likely going through the motions of getting our paperwork together in order to file our taxes, it’s probably a good time to review those credits that are available for Georgia businesses and business owners. Below is a blog article that we posted last year. I hope all of you find this helpful.
As a small business owner myself, I understand the importance of finding ways to save money whenever practical. You also want to invest in your company’s growth. Sometimes saving money and investing in your company don’t seem to go in hand, but this is not necessarily the case. Many owners don’t realize that there are plenty of opportunities to receive tax credits for the very investments that can help their businesses expand and thrive.
Below is a list of current tax credits for which you may qualify, pulled from the Georgia Department of Revenue’s more detailed list. This is just a quick summary of credits and does not include all the pertinent details on qualifications. To get further details, visit the Georgia Department of Revenue for specifics. Should you need help evaluating whether your company would qualify for any of these credits now, or figuring out how to make adjustments in order to earn them, give us a call; we’d love to help you.
101: Employer’s Credit for Basic Skills Education: Businesses that provide or sponsor basic skills education that enhances reading, writing, or mathematical skills up to and including the 12th grade, or classes to receive a GED certificate, may receive a tax credit.
102: Employer’s Credit for Approved Employee Retraining: The retraining tax credit allows employers to claim certain costs of retraining employees to use new equipment, new technology, or new operating systems.
103: Employer’s Jobs Tax Credit: This credit provides for a statewide job tax credit for any business or headquarters of any such business engaged in manufacturing, warehousing and distribution, processing, telecommunications, broadcasting, tourism, or research and development industries, but does not include retail businesses. If other requirements are met, job tax credits are available to businesses of any nature, including retail businesses, in counties recognized and designated as the 40 least developed counties.
104: Employer’s Credit for Purchasing Child Care Property: Employers who purchase qualified child care property will receive a credit totaling 100% of the cost of such property.
105: Employer’s Credit for Providing or Sponsoring Child Care for Employees: Employers who provide or sponsor child care for employees are eligible for a tax credit of up to 75% of the employers’ direct costs.
106: Manufacturer’s Investment Tax Credit: It allows a taxpayer that has operated an existing manufacturing or telecommunications facility in the state for the previous three years to obtain a credit against income tax liability. The credit is calculated on expenses directly related to manufacturing or to providing telecommunications services.
107: Optional Investment Tax Credit: Taxpayers qualifying for the investment tax credit may choose an optional investment tax credit within a designated tiered system.
108: Qualified Transportation Credit: This is a credit of $25 per employee for any “qualified transportation fringe benefit” provided by an employer to an employee as described in Section 132(f) of the IRC of 1986.
109: Low Income Housing Credit: This is a credit against Georgia income taxes for taxpayers owning developments receiving the federal Low-Income Housing Tax Credit that are placed in service on or after January 1, 2001.
110: Diesel Particulate Emission Reduction Technology Equipment: This is a credit given to any person who installs diesel particulate emission reduction equipment at any truck stop, depot, or other facility.
111: Business Enterprise Vehicle Credit: This credit is for a business enterprise for the purchase of a motor vehicle used exclusively to provide transportation for employees. In order to qualify, a business enterprise must certify that each vehicle carries an average daily ridership of not less than four employees for an entire taxable year.
112: Research Tax Credit: A tax credit is allowed for research expenses for research conducted within Georgia for any business or headquarters of any such business engaged in manufacturing, warehousing and distribution, processing, telecommunications, tourism, broadcasting or research and development industries. The credit shall be 10% of the additional research expense over the “base amount,” provided that the business enterprise for the same taxable year claims and is allowed a research credit under Section 41 of the Internal Revenue Code of 1986.
113: Headquarters Tax Credit: Companies establishing their headquarters or relocating their headquarters to Georgia prior to January 1, 2009 may be entitled to a tax credit if the following criteria are met: 1) At least fifty (50) headquarters jobs are created; and 2) within one year of the first hire, $1 million is spent in construction, renovation, leasing, or other cost related to such establishment or reallocation.
114: Port Activity Tax Credit: For taxable years beginning before January 1, 2010, businesses or the headquarters of any such businesses engaged in manufacturing, warehousing and distribution, processing, telecommunications, broad- casting, tourism, or research and development that have increased shipments out of Georgia ports during the previous 12-month period by more than 10% over their 1997 base year port traffic, or by more than 10% over 75 net tons, five containers or ten 20-foot equivalent units (TEU’s) during the previous 12-month period are qualified for increased job tax credits or investment tax credits.
115: Bank Tax Credit: All financial institutions that conduct business or own property in Georgia are required to file a Georgia Financial Institutions Business Occupation Tax Return, Form 900. Effective on or after January 1, 2001, a depository financial institution with a Sub S election can pass through the credit to its shareholders on a pro rata basis.
116: Low Emission Vehicle Credit: This is a credit, the lesser of 10% of the cost of the vehicle or $2,500, for the purchase or lease of a new low emission vehicle. Also there is a credit for the conversion of a standard vehicle to a low emission vehicle which is equal to 10% of the cost of conversion, not to exceed $2,500 per converted vehicle.
117: Zero Emission Vehicle Credit: This is a credit, the lesser of 20% of the cost of the vehicle or $5,000, for the purchase or lease of a new zero emission vehicle. Also there is a credit for the conversion of a standard vehicle to a zero emission vehicle which is equal to 10% of the cost of conversion, not to exceed $2,500 per converted vehicle.
118: New Facilities Jobs Credit: For business enterprises who first qualified in a taxable year beginning before January 1, 2009, $450 million in qualified investment property must be purchased for the project within a six-year period. The manufacturer must also create at a minimum 1,800 new jobs within a six-year period and can receive credit for up to a maximum of 3,300 jobs.
119: Electric Vehicle Charger Credit: This is a credit for a business enterprise for the purchase of an electric vehicle charger located in the State of Georgia. The credit allowed is the lesser of 10% of the cost of the charger or $2,500.
120: New Manufacturing Facilities Property Credit: This is an incentive for a manufacturer who has operated a manufacturing facility in this state for at least 3 years and who spends $800 million on a new manufacturing facility in this state. There is also the requirement that the number of full-time employees equal or exceed 1,800. However, these do not have to be new jobs to Georgia.
121: Historic Rehabilitation Credit: A credit will be available for the certified rehabilitation of a certified structure or historic home. Standards set by the Department of Natural Resources must be met.
122: Film Tax Credit: Production companies which have at least $500,000 of qualified expenditures in a state certified production may claim this credit. Certification must be approved through the Georgia Department of Economic Development. The credit is equal to 20 percent of the base investment in the state, with an additional 10 percent for including a qualified Georgia promotion in the state certified production.
123: Teleworking Credit: Employers who permit their employees to telework will be allowed an income tax credit for expenses incurred up to $1,200 per participating employee. The percentage of the credit for allowed expenditures ranges from 100%, 75% and 25% depending upon whether the business is located in a federal “nonattainment” area, and number of telework days per month required by the participating employees telework agreement.
124: Land Conservation Credit: This provides for an income tax credit for the qualified donation of real property that qualifies as conservation land pursuant to Chapter 22 of Title 36. Property donated to increase building density levels or property that will be used, or is associated with the playing of golf shall not be eligible.
125: Qualified Education Expense Credit: This provides a tax credit for qualified educational expenses. A corporation is eligible for a credit amount that can equal up to 75% of its income tax liability. The credit is allowed on a first come, first served basis.
126: Seed-Capital Fund Credit: This provides tax credits for certain qualified investments made on or after July 1, 2008.
127: Clean Energy Property Credit: This provides a tax credit for the construction, purchase, or lease of clean energy property that is placed into service in Georgia between July 1, 2008 and December 31, 2012.
128: Wood Residuals Credit: This provides a tax credit for transporting or diverting wood residuals to a renewable biomass qualified facility on or after July 1, 2008.
129: Qualified Health Insurance Expense Credit: Effective for taxable years beginning on or after January 1, 2009, an employer (but only an employer who employs 50 or fewer persons either directly or whose compensation is reported on Form 1099) is allowed a tax credit for qualified health insurance expenses in the amount of $250.00 for each employee enrolled for twelve consecutive months in a qualified health insurance plan.
130: Quality Jobs Credit: For tax years beginning on or after January 1, 2009, a taxpayer creating at least 50 “new quality jobs” may be entitled to a credit provided certain conditions are met. A “new quality job” means a job that: 1) Is located in this state; 2) Has a regular work week of 30 hours or more; 3) Is not a job that is or was already located in Georgia regardless of which taxpayer the individual performed services for; and 4) which pays at or above 110 percent of the average wage of the county in which it is located.
131: Alternate Port Activity Tax Credit: O.C.G.A. § 48-7-40.15A provides an alternate port tax credit. The definitions of “base year port traffic” and “port traffic” include imports and exports of product.