TAX CREDITS

Urban and Industrial Sites Reinvestment (URA) Tax Credit Program: Primary incentive tool used by the State to attract new business investment and job creation to economically distressed areas. Companies that invest at least $5 million in facilities located in eligible areas may be entitled to a non-refundable corporate income tax credit under this discretionary program. Tax credits are disbursed over a 10-year period.  Unused credits may be carried forward or transferred/sold to other Connecticut taxpayers.

Research and Development Tax Credit: Equal to 20% of R&D expenditures in Connecticut in the current income year exceeding R&D expenditures of the prior taxable year. Unsold credits can be carried forward, and for companies with less than $70 million in gross income, credits can be sold to the State for 65% of their value.

TAX EXEMPTIONS

Sales and Use Tax Exemption: The State has the authority to provide an exemption from state sales tax on the purchase of construction materials and furniture, fixtures and equipment for businesses that make capital investments and create jobs. Equipment, tools, machinery, supplies, materials, and fuel used in renewable energy and clean energy technology industries are also exempt from state sales and use tax.

Real and Personal Property Tax: An exemption of up to 100% for newly acquired and installed machinery, inventories, unbundled software, commercial motor vehicles; dependent on certain conditions.

SPECIAL ZONING

Enterprise Zone: Businesses that locate inside an Enterprise Zone, or within a community which contains a zone, may be eligible for a 5-year, 80% abatement on real and business personal property taxes and a 10-year, 25% tax credit on the portion of the Connecticut corporation business tax that is directly attributable to the company relocation, expansion or renovation project.

LOW-INTEREST LOANS

Low-Interest and Forgivable Loans: Businesses that make capital improvements and create new jobs may be entitled to a low interest loan offered by the CT Department of Economic and Community Development (DECD). This discretionary program provides loans at below market rates (generally between 1.5% and 2.5%) with a 10-year term. DECD at its discretion may forgive a portion of the loan principal (convert to a grant) if certain minimum employment and investment thresholds are met.

GRANTS

Grants: DECD offers discretionary grants to support economic development projects that result in new capital investment and job creation. Grants may also be available for job training and alternative energy installations.

 

Last updated: April 2016

 


 
BIGGINS LACY SHAPIRO & COMPANY
PRINCETON
47 Hulfish Street, Suite 320
Princeton, NJ 08542
(609) 924-9775
NEW YORK
215 Park Ave South
New York, NY 10003
(646) 652-7555
CHICAGO
30 S. Wacker, Suite 2200
Chicago, IL 60606
(312) 924-2490