GEORGIA JOBS TAX CREDIT
Georgia provides a statewide job tax credit for any business or headquarters of any such business creating net new jobs for Georgia and engaged in in strategic industries such as manufacturing, warehousing & distribution, processing, telecommunications, broadcasting, tourism, research and development industries, biomedical manufacturing, and services for the elderly and persons with disabilities. The amount of the per-job tax credit depends on the community’s designated tier.
Putnam County is a Tier 2 community. New full-time jobs that exceed 10 in a calendar year and meet the criteria would qualify for job tax credits of $3,000/job for 5 years. The credit would be applied to your corporate income tax liability and then to withholding.
For new full-time jobs located the South Industrial Park (Less Developed Census Tract #9602.02) and the Rock Eagle Technology Park (Less Developed Census Tract #9602.01), the minimum net new full-time jobs required to qualify for job tax credits is 5 in a tax year and you would qualify for $3,500/job for 5 years. The credit would be applied to your corporate income tax liability and then to withholding.
Learn About Tax Credits Here and view the brochure below for Business Incentives
PORT TAX CREDIT BONUS
The Port Tax Credit Bonus is available to taxpayers who qualify for the Job Tax Credit or the Investment Tax Credit, and increase imports or exports through a Georgia port by 10 percent over the previous or base year. Base year port traffic must be at least 75 net tons, five containers or 10 TEUs (twenty-foot equivalent units); if not, the percentage increase in port traffic will be calculated using 75 net tons, five containers, or 10 TEUs as the base. The Port Tax Credit bonus can be used with either the Job or the Investment Tax Credit program, provided that the company meets the requirements for one of those programs. Port Tax Credits may be used to offset up to 50 percent of the company’s corporate income tax liability. Unused credits may be carried forward for 10 years, provided that the increase in port traffic remains above levels established in year one for eligibility and that the company continues to meet the job or investment tax credit requirements. Note that the Port Tax Credit Bonus cannot be utilized with the Quality Jobs Tax Credit.
Port Tax Credits are subject to program requirements as outlined in O.C.G.A. § 48-7-40.15.
QUALITY JOBS TAX CREDIT
Companies may receive Quality Jobs Tax Credits (QJTC) if, during a 12-month period, they create and maintain at least 50 net new jobs that pay at least 110 percent of the county’s average wage. The QJTC value ranges from $2,500 to $5,000 per job, per year, for up to five years.
After qualifying, a company can earn additional QJTC credits ($2,500 to $5,000 per job, per year, for up to five years) over the next seven years by creating and maintaining additional qualifying jobs. New jobs created after the seven-year period ends do not earn QJTC credits unless the project creates at least 50 net new qualifying jobs in a 12-month period again to begin another seven-year cycle.
QJTC may be applied against 100 percent of the state corporate income tax liability, and once that liability has been exhausted, the credits may be used to offset the company’s state payroll withholding. Claimed but unused credits may be carried forward for 10 years from the close of the taxable year in which the qualified jobs were established.
New jobs that do not meet the requirements for the QJTC may count toward Job Tax Credits if they meet the eligibility requirements for that program separately. For current average county wages, visit Explorer.DOL.State.GA.US/mis/Current/ewcurrent.pdf. QJTCs are subject to requirements outlined in O.C.G.A. § 48-7-40.17 and rules published by the Georgia Department of Revenue in regulation 560-7-8-.51.
RESEARCH & DEVELOPMENT TAX CREDIT
Georgia offers an incentive to new and existing business entities performing qualified research and development in Georgia. Qualified research expenses are defined in Section 41 of the Internal Revenue Code of 1986, as amended, except that all wages paid and all purchases of services and supplies must be for research conducted within the state of Georgia. Companies may claim a 10 percent tax credit of increased R&D expenses subject to a base amount calculation.
The base amount = Current Year Georgia Gross Receipts x [(the average of the ratios of the company’s qualified Georgia research expenses to Georgia gross receipts for the preceding three taxable years) OR 0.300, whichever is less]. For new Georgia companies or for companies with no prior R&D expenditures in Georgia, the base amount is 30 percent of the current year’s Georgia gross receipts.
The credit is determined by taking the current year’s qualified R&D expenses, subtracting the base amount, and multiplying by 10 percent. The R&D credit is applied to 50 percent of the company’s net Georgia corporate income tax liability after all other credits have been applied. Any excess R&D credits can then be applied to the company’s state payroll withholding. Any unused credits can be carried forward for up to 10 years from the close of the taxable year in which the qualified research expenses were made.
Research and Development Tax Credits are subject to program requirements as outlined in O.C.G.A. § 48-7-40.12.
WORK OPPORTUNITY TAX CREDIT PROGRAM (WOTC)
The Georgia Department of Labor (GDOL) coordinates the federal Work Opportunity Tax Credit Program. The WOTC program is a federal tax credit incentive that the U.S. federal government provides to private-sector businesses for hiring individuals from nine target groups who have consistently faced significant barriers to employment.
Among others, target groups include:
- Unemployed veterans
- Certain Temporary Assistance for Needy Families (TANF) recipients
- Food Stamp recipients
- Certain residents of an Empowerment Zone (EZ)
- Rural Renewal County (RRC) residents
Participating companies are compensated by being able to reduce their federal income tax liability with a tax credit between $1,200 to $9,000 per qualified employee, depending on the target group. For more information visit: DOL.State.GA.US/em/learn_about_tax_credits_and_incentives.htm.
CHILD CARE TAX CREDITS
The Child Care Tax Credit is for employers who purchase or build qualified child care facilities, or who provide or sponsor child care for employees.
For employers who purchase or build a statelicensed facility, the credit is equal to 100 percent of the cost of construction, which is earned over 10 years (10 percent each year). Unused credits can be carried forward for three years.
Employers who provide or sponsor child care at a state-licensed facility are eligible for a credit equal to Mitsubishi Hitachi Power Systems 75 percent of the employer’s direct costs. Credits that are related to providing or sponsoring child care may be carried forward for five years.
All child care tax credits can be applied to 50 percent of the corporate income tax liability.
Child Care Tax Credits are subject to program requirements as outlined in O.C.G.A. § 48-7-40.6 and rules published by the Georgia Department of Revenue in regulation 560-7-8-.38.
PAROLEE TAX CREDIT
Effective January 1, 2017, Georgia offers a $2,500 per person tax credit for hiring an individual granted parole within 12 months of his or her date of hire.
This credit, which can be used in addition to any job tax credits that the company may be eligible for with the position, can only be used once per individual, and there is a per-employer limit of $50,000 for each tax year. The credits are applied to 100% of state corporate income tax liability, with the ability to carry forward any excess credits for three years.
Employers from any industry are eligible for the tax credit, but the company can only claim the tax credit if it pays the individual at or above the average wage of the county with the lowest average wage in the state ($471/week as of June 2016).
Parolee Tax Credits are subject to program requirements as outlined in O.C.G.A. 48-7-40.31 and rules published by the Georgia Department of Revenue in regulation 560-7-8-.58.
GEORGIA FILM, TELEVISION AND INTERACTIVE ENTERTAINMENT TAX CREDIT
The Georgia Entertainment Industry Investment Act offers an across-the-board flat tax credit of 20 percent based on a minimum investment of $500,000 on qualified productions in Georgia.
The $500,000 minimum expenditure threshold can be met with one or the total of multiple projects aggregated. An additional 10 percent uplift can be earned by including an embedded, animated Georgia logo and web link on the project’s promotional webpage, or through approved alternatives if they offer equal or greater marketing opportunities for the state. Qualified expenditures include materials, services and labor.
Eligible productions include:
- Feature Films
- Television Movies
- Pilots or Series
- Music Videos
- Certain Interactive Entertainment Projects (Animation, Special Effects and Video Game Development)
Interactive entertainment companies will be eligible for this credit only if their gross income is less than $100 million. The maximum credit for any qualified interactive entertainment production company and its affiliates will be $5 million. The total credits available for interactive entertainment production companies and their affiliates will be capped at $25 million each year and will be awarded on a first-come, first served basis.
This income tax credit may be used against Georgia income tax liability or the company’s Georgia payroll withholding. If the production company chooses, they may make a one-time sale or transfer of the tax credit to one or more Georgia taxpayers.
Film, Television and Interactive Entertainment Tax Credits are subject to program requirements as outlined in O.C.G.A. § 48-7-40.26.