Business Incentives
Cumberland Empowerment Zone Corporation
Tax Incentive Programs
Empowerment Zone businesses are eligible for several tax incentives. The Empowerment Zone tax incentives are designed to encourage businesses to operate within the Zone and to hire local residents. Incentives include employment credits, low-interest loans through EZ facility bonds, and reduced taxation on capital gains.
Tax Incentives
Empowerment Zone Employment Credit allows Empowerment Zone businesses to take a credit against federal taxes of up to $3,000 for each year of Empowerment Zone designation for every existing employee and new hire that lives and works in the Empowerment Zone.
Work Opportunity Tax Credit allows businesses to take a credit up to $2,400 against federal taxes for each new hire from groups that have high unemployment rates or other special employment needs, including: youth ages 18 to 24, who live in an Empowerment Zone, and summer hires ages 16 to 17 who live in an Empowerment Zone.
Welfare to Work Tax Credit allows businesses that hire long-term family assistance recipients to take a two-year credit against federal taxes. Credits are up to $3,500 for the first year, and $5,000 for the second year for each new hire.
Tax-Exempt Bonding
Empowerment Zone Facility Bonds provide businesses with access to $130 million in tax-exempt facility bonds. The bonds can be utilized for property and equipment purchase, new construction and/or renovations. The $10 million cap on project expenditures is not applicable to Empowerment Zone bonds and the bonds can be used for activities beyond manufacturing. Bond projects must be located within the Zone and a business must hire at least 35% of its employees from the Zone. Tax-exempt financing is typically three to four percentage points lower than conventional financing.
Tax Deductions
Section 179 of the tax code allows businesses to choose to deduct all or part of certain qualifying property in the year that place it in service. The increased section 179 deduction allows businesses located within the Zone to increase their IRS 179 tax deduction by as much as $35,000.
For more tax incentive information visit www.hud.gov.
Vineland/Millville Urban Enterprise Zone Progam
Not only will it save you money, it is a FREE program!
UEZ businesses are eligible for several tax incentives. The Urban Enterprise Zone Program is designed to encourage businesses to operate within the Zone and to hire local residents. Incentives include 3.5% Sales Tax, Tax Exempt Purchases, Special Loan Programs Corporate Business Tax Credits and Unemployment Tax Awards, Energy Sales Tax Benefits.
Reduced Sales Tax allows participating retailers to charge a 3.5% New Jersey Sales Tax on certain merchandise (instead of the 7% outside the UEZ).
Tax Exempt Purchases allows participating businesses to be exempt from the New Jersey Sales Tax on the cost of certain construction, equipment, office furniture and supplies.
Corporate Business Tax Credits allows participating businesses that are not warehousing or retail sales oriented. It is available to corporations subject to the Corporate Business Tax which hire certain new employees at the zone location after they have been certified. The corporation may claim either $1,500 or $500 credit for each new employee, provided certain employment criteria are met.
Unemployment Insurance Award allows participating businesses that hire new employees meeting a "25% Employment Factor" (explained in the application documents). The employees must earn less than $4,500 per quarter. Every March, the Department of Labor will send an application to all businesses that reported hiring employees that meet the necessary characteristics.
Energy Sales Tax Exemption allows participating manufacturers employing at least 250 people (of which 125 or more are directly involved in the manufacturing process) to be exempt from paying sales tax on energy used at the business location.
Please call our office at (856) 563-0440 for a Free Certification Application and visit our website at www.vinelandmillvilleuez.com. We will be happy to assist you in any way we can.
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