SPOTLIGHT PROGRAMS

Job Tax Credit: Businesses that create net new full-time jobs may be eligible for an annual non-refundable and non-transferable tax credit of $1,250 to $4,000 per new job for 5 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.  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.  In certain instances, 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.

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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.

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TAX CREDITS

Mega Project Tax Credit: Companies that create at least 1,800 net new jobs over a period of six years 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. Companies that invest at least $600 million are granted an additional two years to meet job creation requirements, and companies that invest at least $800 million are granted an additional four 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. Claiming this credit forgoes claiming any other credit besides R&D and retraining tax credits.

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Premium Tax Credit: These tax credits can be used to against annual premium tax applied to insurance companies. The company must satisfy the job creation requirements specific to county tiers. The award can range from $750 to $3,500 per eligible job per year for up to five years. Unused tax credits can be carried forward for 10 years.

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Investment Tax Credit:  This program provides tax credit to companies engaged in manufacturing or telecommunications support that have operated in Georgia for at least 3 years. Businesses with at least $100,000 of qualified investment may be eligible for a tax credit ranging from 1% to 8%.  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; eligible companies in Rural Counites within Tiers 1 to 2 can apply credits to payroll withholding.  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.

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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 deepwater port by a specified amount over an indicated year. Base year port traffic minimum is 75 net tons, 5 containers, or 10 TEUs. 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.

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Research and Development Tax Credit:  Businesses may claim a tax credit equal to 10% of qualified R&D spending in Georgia minus a base amount.   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.

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Life Sciences Manufacturing Tax Credit: This credit is a bonus that can be added to the Job Tax Credit for the manufacturing of pharmaceuticals, medicines, and medical equipment/supplies in Georgia. Recipients must also be eligible for the Job Tax Credit. Credit is equal to an additional $1,250 for eligible jobs and may be used to offset up to 100% of the company’s corporate income tax liability. Excess credit may be used to offset the company’s state payroll withholding. Unused credits may be carried forward for a period of 10 years.

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TAX EXEMPTIONS/ABATEMENTS

Manufacturers Sales & Use: Georgia exempts the 6%-9% sales tax that manufacturers must make for their operations. These include expenses such as manufacturing machinery and equipment, repair to industrial machinery, raw materials and packaging, energy used in manufacturing, primary material handling equipment, pollution control equipment, and clean room equipment.

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Data Centers and High-Tech Companies Sales & Use: Data centers are exempt from the 6%-9% sales tax if they create a specified number of new high-paying jobs and meet a minimum qualified investment threshold. The minimum investment threshold depends on the county where the investment is being made. The sale of certain computers is exempt when the total qualifying purchases of a high-tech company exceeds $15 million. Effective January 1, 2024, any entity claiming this exemption must pay 10% of all sales and use ax imposed on the first $15 million.

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Distribution Centers Sales & Use: Distribution centers are eligible for the 6%-9% exemption when they invest $5 million in the purchase or expansion of a facility in qualifying expenses. The facility cannot have retail sales above or equal to 15% of the facility’s total revenues.

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JOB TRAINING

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. Training program must be approved by the Technical College System of Georgia.

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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.

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LOCAL INCENTIVES

Bond-Enabled Property Tax Abatement: Direct property tax abatements are statutorily banned in Georgia. However, local communities can provide property tax relief to companies locating within their community through a bond-leaseback transaction of real and personal property. The public ownership structure enables a negotiated Payment-In-Lieu-Of-Taxes (PILOT) to effectuate a temporary partial tax exemption.

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Level One Freeport Law: Counties and Municipalities in Georgia have the option of enacting local property tax exemptions for four different classes of inventory at 20%, 40%, 60%, 80%, or 100%. Those classes are: Class One inventory of goods in the process of being manufactured or produced, including raw materials and partly finished goods; Class Two inventory of finished goods manufactured or produced within Georgia held by the manufacturer or producer for a period not exceeding 12 months, Class Three inventory of finished goods stored in a warehouse, dock or wharf, which is destined to be shipped outside Georgia, for a period to not exceed 12 months; and Class Four stock in trade of a fulfillment center that is stored in a warehouse for a period not exceeding 12 months.

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Last Updated: April 2023