Transcript Pittsburg – Bay Point Enterprise Zone

Pittsburg – Bay Point
Enterprise Zone
2012 - 2027
What is an Enterprise Zone?
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Areas within California, designated by the
Department of Housing and Community
Development.
Used to encourage growth, development, and
investment in these areas.
Businesses with locations within these
Enterprise Zones may qualify for special tax
incentives and credits
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Available Enterprise Zone Credits
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Hiring Credit
Sales and Use Tax Credit
Business Expense Deductions
Net Interest Deduction
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Approved Boundary Map
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Available Enterprise Zone Credits
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Credits may be determined from January 1,
2005 to the present, and are applied to state
income tax (California statute is open for 4
years).
Credits can be applied to future returns, or
can be amended onto previous returns.
Credits can be carried over if not completely
used within a certain tax year.
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What is the Hiring Credit?
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Businesses within the Enterprise Zones can
claim the hiring credit for an employee who:
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Was hired after the Enterprise Zone received its
designation,
Spends at least 90% of work time on activities
related to business within the Enterprise Zone,
Performs at least 50% of their work within the
Enterprise Zone, and
Is determined a “Qualified” Employee.
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Qualified Employees
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Qualified employees are those who are:
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A resident of a targeted employment area within an Enterprise zone
Recently discharged (last 4 years) or Vietnam-era veteran
Displaced Workers (laid off from previous employer)
Economically disadvantaged (minimal or no earnings in the 90 days prior to
date of hire)
Receiving SSI, AFDC, food stamps or General Assistance
Work Opportunity Tax Credit (WOTC) or Welfare to Work (W2W)
Eligible for services under the Workforce Investment Act – intensive services
(WIA)
Participant in Welfare to Work activities under CalWORKS
Ex-offenders (no limitation on how far back)
Native Americans (enrolled with tribe, has tribal card)
Native Samoan, Native Hawaiian
A disabled individual eligible (including disabled Veterans and/or enrolled in
or completed a state rehabilitation plan
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Hiring Credit Example
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Assume company A has 10 employees working within the Enterprise
zone, and 5 of these employees qualify. Each employee makes
$10/hour and works 2,080 hours per year = $20,800 in wages
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The following credits would be available (estimated):
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Year 1
Year 2
Year 3
Year 4
Year 5
Total Credit
$
52,000
20,800
15,600
10,400
5,200
$ 104,000
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What is the Sales & Use Tax Credit?
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An enterprise zone business may claim a credit
equal to the state sales or use tax paid/incurred for
purchase of “qualified” property.
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Qualified property includes the purchase of
machinery or machinery parts used in the following:
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Fabricating, processing, assembling, and manufacturing;
Data processing and communications equipment
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Sales & Use Tax Credit Example
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Corporations can claim credit on the first $20,000,000
of qualifying purchases per year.
Suppose Company A purchases $10,000 worth of
qualified property. The current tax rate is 9.25%.
The Sales & Use Tax credit would be calculated as
follows:
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Amount of qualifying purchases
State sales tax paid
Total Credit
$10,000
925
$ 925
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Contact Information
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Ed Solomon
Pittsburg Bay Point Enterprise Zone Administrator
Workforce Development Board of Contra Costa County
300 Ellinwood Way, 3rd Floor
Pleasant Hill, CA 94523
925.602.6821 (office)
607.761.9272 (cell)
925.602.6802 (fax)
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