Biggins Lacy Shapiro & Company, LLC

Colorado Economic Development Incentive Programs

tax credits

Job Growth Incentive Tax Credit (JGITC): Businesses that create at least 20 new jobs (5 new jobs if located in an Enhanced Rural Enterprise Zone) with wages at or above the average wage of the county where the project is located may receive a corporate income tax credit. The credit is equal to 50% of FICA or payroll taxes the company pays for new hires. Credits may be claimed for up to 8 years and are non-refundable and non-transferable. Unused credits may be carried forward for up to 10 years.

Transferable Tax Credit: This program allows companies that make major capital investments to transfer certain tax credits that are earned in the course of making that investment. TTC allows approved companies to sell certain income tax credits that are normally not transferable and could not be used unless the company had a state income tax liability. To be potentially eligible, a business must make a capital investment of at least $100 million over the ten consecutive income tax years that commence immediately following the date of pre-certification by the approval body, the Colorado Economic Development Commission.

GRANTS

Strategic Fund Incentive: This discretionary program offers cash grants ranging from $2,500 to $5,000 for each new job created and retained for one year. To qualify, a business must create jobs that pay an average wage that is at or above 100% of the average wage of the county where the project is located. Local governments must provide matching funds for a business to be eligible for this program. Companies pursuing a Strategic Fund incentive may not pursue a Job Growth Incentive Tax Credit for the same project. Additionally, a $1:$1 match is required at the municipal level for all Strategic Fund grant awards.

SPECIAL ZONING

Enterprise Zone Program: Businesses that locate in an Enterprise Zone may qualify for the following non-refundable corporate income tax credits:

  • Investment Tax Credit (ITC): 3% of business personal property
  • Job Training Tax Credit: 12% of qualifying training expenses
  • New Employee Credit: $1,100 per job
  • Enhanced Rural EZ: $2,000 per job
  • R&D Increase Tax Credit: 3% of increased R&D expenditures
  • Vacant Commercial Building Rehabilitation Tax Credit: 25% of rehab expenditures

To encourage investment in the state’s most rural and economically distressed areas, Rural Enhanced Enterprise Zones have been created. Businesses that locate in Rural Enhanced Enterprise Zones may receive larger tax credit amounts and additional benefits than those offered under the Enterprise Zone program.

TRAINIING PROGRAM

Colorado FIRST and Existing Industry Customized Job Training Programs: Colorado FIRST program offers job training grants of up to $1,200 per job for businesses that are expanding in or relocating to Colorado or up to $1,000 per job for qualified existing businesses. A minimum of 40% of the total training costs must be covered by the company.

TAX EXEMPTIONS

Sales and Use Tax Exemptions: An exemption of state sales and use taxes is available for purchases of manufacturing machinery, machine tools, and parts.

Last Updated:  June 2018



 
Biggins Lacy Shapiro & Company, LLC
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