Are you a business owner who is considering purchasing new equipment, training employees, creating new staff positions, or renovating a vacant building? If so, you may want to look into Region 10’s Enterprise Zone program, and learn about the possible tax credits that you may qualify for. As the 2014 tax season ends, it is important to start planning for 2015.
Each year, the Colorado Office of Economic Development and International Trade (OEDIT) supports commercial growth via tax credits for projects certified by the Enterprise Zone. To aid economically distressed communities, OEDIT also designates “Enhanced Rural Enterprise Zones” (EREZ). These special zones qualify for increased tax credits – up to an additional $200 credit per job – with the hope of spurring increased economic development for troubled areas. In Region 10’s six-county service area, four counties – Delta, Montrose, Hinsdale, and Ouray Counties – all qualify as EREZ.
To qualify for EZ tax credits, business owners must “pre-certify” their business activities to make certain that they qualify for the following:
- Investment Tax Credit: 3% on equipment purchases
- Commercial Vehicle Investment: 1.5% of commercial vehicle purchases
- Job Training Credit: 12% of qualified training expenses
- New Employee Credit: $1,100 per new job
- Agricultural Processor New Employee Credit: $500 per new job
- Employee Sponsored Health Insurance Credit: $1,000 per covered employee for new businesses
- R&D Increase Credit: 3% of increased R&D expenditures
- Vacant Building Rehabilitation Credit: 25% of rehab expenditures (up to $50,000) on building that is at least 20 years old and has been vacant for 2 years or more
These credits are available on a year-to-year basis, because they are subject to change with the state’s budget. All certified public accountants receive updates on Enterprise Zone restrictions each year, so whoever is responsible for your tax return would be your best source of information. It is of the utmost importance that you pre-certify your expenses, because these credits cannot be applied retroactively.
If your accountant is unfamiliar with the program, please contact Region 10 at 970.249.2436 x 202 or firstname.lastname@example.org.