The Renewal Community Tax Initiative provides Federal Tax incentives to businesses that invest, conduct business or hire people who live in a designated area of the community called the Renewal Community Zone. Brief descriptions of the tax incentives listed below. For more information on each of the tax credits, click the title or the appropriate link on the left.
These incentives are for businesses located in the Renewal Community Zone only. Click "ARE YOU IN THE ZONE?" icon on the left to verify your business is in the zone.
Employment Credit Up to $1,500 per qualified employee per year
Federal tax credit for every qualified employee (15% of first $10,000 paid). Employees must live and work in the zone. There is no limit on number of eligible employees you hire.
CRD
Up to 50% deduction allowed in the first year a building is placed into service, or 10% per year for 10 years can be taken for qualified expenses related to acquisition and/or improvement to properties located in the RC Zone that will be used for commercial or business purposes. Chattanooga has $12 Million in deductions to award qualifying building projects every year of the Renewal Community designation.
0% Capital Gains
If a business holds a Renewal Community Business asset acquired after December 31, 2001, and before January 1, 2010, for a minimum of 5 years and employs at lease 35% of its workforce from within the RC zone during those 5 years, the business does not have to include any "qualified capital gain" from the asset's sale or exchange in its gross income.
Increased 179 Deductions
For businesses who maintain at least 35% of their workforce from the RC Zone, they qualify for up to $35,000 increased 179 deduction for property/equipment items owned by the business.
Low Income Housing Credit
10 year federal tax credit for owners of new or renovated rental units that reserve certain percentage for low-income use.
New Markets Tax Credit
The New Markets Tax Credit provides individuals and corporations with an incentive to invest in a community development entity (CDE) that provides capital and financial advisory services to low-income communities.
Welfare to Work Credit
The Welfare to Work (WtW) credit provides businesses with an incentive to hire long-term family assistance recipients.
Work Opportunity Tax Credit
The Work Opportunity Tax Credit (WOTC) provides businesses with an incentive to hire individuals from groups that have particularly high unemployment rates or other special employment needs.
Brownfields
This deduction provides businesses with an incentive to clean up certain sites that are contaminated with hazardous substances.
Qualified Zone Academy Bonds
Local governments can issue bonds at 0% interest to finance public school programs with private partnerships. Prive contribution must equal at leat 10% of bond proceeds. |
