Biggins Lacy Shapiro & Company, LLC

Georgia Economic Development Incentive Programs

TAX CREDITS

Job Tax Credit:  Businesses that create net new full-time jobs may be eligible for an annual corporate income tax credit of $750 to $4,000 per job. The Georgia facility must be engaged in a specified operation, or the headquarters of a company engaged in a specified industry, including manufacturing, warehousing, distribution, logistics, software development, contact centers, and others.  The exact value of the as-of-right tax credits will depend on job creation and the development tier of the county or census tract where the project is located.  These non-refundable and non-transferable credits are claimed each year for 5 years.  In certain areas, credits can be applied to payroll withholding, once corporate income tax liability is exhausted.  Unused credits may be carried forward for up to 10 years. A company may claim either but not both a job tax credit and investment tax credit.

Quality Jobs Tax Credit:  This as-of-right program offers tax credits to companies that within a 24-month period create at least 50 net new jobs with wages that are at or above 110% of the county average wage. Credits range from $2,500 to $5,000 per job, per year for 5 years.  The amount of credit per job will depend on the qualifying jobs’ average wage compared to the county’s average wage (a range of $2,500 for qualifying jobs’ average wage that is 110% - 120% of the county average, up to $5,000 for qualifying jobs’ average wage that is 200% or greater of the county average). Quality Jobs Tax Credits can be used to offset up to 100% of state corporate income tax liability.  If the credit exceeds a company’s tax liability in any given year, the business may use the excess credit against its state payroll withholding.   Any unused credits can be carried forward for up to 10 years.   

Mega Project Tax Credit: Companies that create at least 1,800 net new jobs and either invest a minimum of $450 million in a business facility or have an annual payroll of at least $150 million may claim a tax credit of $5,250 per job, per year for a period of 5 years. The project must also pay an average wage above specified minimums or show high growth potential. Credits can be used to offset up to 100% of state corporate income tax liability.  If the credit exceeds a company’s tax liability in any given year, the business may use the excess credit against its state payroll withholding.   Any unused credits can be carried forward for up to 10 years. A maximum of 4,500 new jobs created by any one project may be eligible to receive the Mega Project Tax Credit. 

Investment Tax Credit:  Provides tax credits to companies engaged in manufacturing or telecommunications support that have operated in Georgia for at least 3 years. Businesses may be eligible for a tax credit ranging from 1% to 8% of qualified investment of at least $50,000.  The actual credit will depend on the development tier of the county in which the project is located and the type of capital expenditures that are made by a business.  Credits can be used to offset up to 50% of a state corporate income tax liability.  Any unused credits can be carried forward for up to 10 years. A company may claim either but not both a job tax credit and investment tax credit.

Port Activity Bonus Tax Credits: A tax credit bonus is available to companies that qualify for the Job Tax Credit or the Investment Tax Credit, and increase imports or exports through a Georgia port by 10 percent over the previous or base year. Base year port traffic must be at least 75 net tons, five containers or 10 TEUs; if not, the percentage increase in port traffic will be calculated using 75 net tons, five containers, or 10 TEUs as the base. The value of the bonus is an additional $1,250 tax credit per job, per year for up to five years when used with Job Tax Credits. When used with the Investment Tax Credit, the bonus increases the Investment Tax Credit to the equivalent of a Tier 1 location, regardless of the actual tier level.

Research and Development Tax Credit:  Businesses may claim a tax credit equal to 10% of qualified R&D spending in Georgia when compared to a base period.  The credit can be used to offset up to 50% of net Georgia corporate income tax liability after all other credits have been applied.  Any excess R&D credits can be applied to state payroll withholding.  Unused credits can be carried forward for up to 10 years. The Georgia facility must be engaged in a specified operation, or the headquarters of a company engaged in a specified industry, including manufacturing, warehousing, distribution, logistics, software development, contact centers, and others, to qualify for the Research and Development Tax Credit.

TAX EXEMPTIONS

Sales & Use Tax Exemptions: Machinery, equipment, and materials that are used in the manufacturing process are exempt from sales and use tax; as well as primary material handling equipment (minimum investment of $5 million in the purchase or expansion); data center materials, components, machinery, hardware, software or equipment; and certain computer equipment purchased by a “high tech company” as defined in the enabling legislation (minimum $15 million in qualifying purchases in one year). Energy used in the manufacturing process is also exempt from sales and use tax, except for the portion dedicated to education (usually 1%). Local governments are allowed to enact an energy excise tax to replace the local portion of the exempted sales and use tax on energy used in the manufacturing process.

TRAINING PROGRAMS

Retraining Tax Credit: Businesses that retrain employees to use new equipment or learn new technology skills may qualify for a tax credit equal to 50% of direct training expenses with a maximum credit of $500 per full-time employee per approved training program per year. The total amount of credit for one employee cannot exceed $1,250 per year. Tax credits can be used to offset up to 50% of a company’s state corporate income tax liability. Unused credits can be carried forward for up to 10 years.

Quick Start Employee Training: This discretionary incentive provides training space, instructors and all needed training materials for new employees in skill-based jobs at no cost to qualifying companies.  Quick Start helps companies assess, select and train the right new employees for new jobs in an expansion or relocation.

Last updated: May 2019



 
Biggins Lacy Shapiro & Company, LLC
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