Job Creation Tax Credit (JCTC): This program provides a non-refundable corporate income tax credit to businesses that create at least 25 new jobs or expand existing employment by 20%. The credit is equal to $1,000 for each newly created job. Credits cannot be sold or transferred, however unused credits may be carried forward for 5 years.
Research and Development Tax Credit: Offers a non-refundable tax credit equal to 10% of a company’s R&D expenses over a base period. The credits are assignable, and may be carried forward for up to 15 years.
Local Economic Revitalization Tax Assistance (LERTA): This program allows local taxing authorities to provide real property tax exemptions for projects that involve new construction or result in improvements made to industrial, commercial, or other business property. The exemptions apply to the assessed value of new construction and the assessed value of improvements made to an existing building. Eligible projects must be located in an area designated as a Local Economic Revitalization Assistance zone. To receive the 10-year exemption, approval is required from all local taxing authorities, including the school district.
In addition to LERTA, Pennsylvania permits local taxing jurisdictions to use tax increment financing (TIF) to encourage redevelopment of deteriorated areas. In Pennsylvania, tax increment financing can be financed from real property taxes, sales taxes or business gross receipts taxes.
Keystone Opportunity Zone: Businesses that locate in a KOZ are eligible for credits, waivers and broad-based exemptions on state and local taxes for a 10-year period. The effective tax burden for a company may be reduced to zero. To qualify for the full range of KOZ benefits, existing businesses that relocate from a non-KOZ Pennsylvania location to a KOZ must increase full-time employment by 20% within the first full year of operation or make a capital investment equal to 10% of gross revenues from the previous fiscal year that were attributable to the business operations at the former non-KOZ Pennsylvania location.
Pennsylvania First Program (PA First): Businesses that make capital investments and commit to creating and/or retaining jobs may be entitled to grants, loans, or loan guarantees offered under this discretionary program. Program funds may be used to offset costs associated with building improvements, capital expenditures, environmental assessments, and land acquisition. In addition to businesses, applicants for PA First funds may also include municipalities, redevelopment authorities, and local development districts. The maximum amount of assistance is capped at $5,000 per job.
Industrial Sites Reuse Program (ISRP): Provides grants and low-interest loan financing to perform environmental site assessment and remediation work at former industrial sites.
Last Updated April 2016