Our nation’s “economic turnaround” continues to take shape. As many different asset classes continue to grow with talent and capital expenditures, some companies may think that their business is too small, is not growing quickly enough, or is not making a big enough investment to qualify for economic incentives.
Governments are interested in attracting new businesses, retaining existing businesses and discovering new investment opportunities to create jobs, promote economic growth and help maintain an area’s economic vitality and quality of life. Additionally, the resulting economic activity helps maintain governmental tax revenues used to support schools, infrastructure and community resources.
State and local governments will offer incentives to assist business growth in their state or community instead of another. Since state and local incentives are offered separately, many states will offer incentives to businesses that create as few as 10 new jobs over a five-year period. Local authorities can offer incentives with capital expenditures of as little as $1 million.
Incentives are customized according to the needs of each business. They can include tax abatements, payroll tax credits, infrastructure grants, lower interest loans, relocation or training grants, special lease or construction terms and tax refund credits.
Navigating through the maze of potential economic incentives available can be tricky and timing is important.
When should your business explore incentives? Prior to hiring new employees, making capital investment or signing lease/purchase agreements.
Here are KEY ACTIONS that can trigger economic incentives:
- Adding Jobs
- Buying, Leasing or Building a Facility
- Acquisition or Merger
- Relocating Operations
- Expanding or Downsizing Operations
- Purchasing Equipment
- Training Initiatives
Our firms can work in conjunction on your behalf with state and local officials to identify, negotiate and procure incentives for your company. We use a proven process to highlight project fact patterns and propose financial-incentive solutions that benefit both corporate goals and public economic development.
The incentive landscape is complex and constantly changing, which is why it is shrewd to have knowledgeable advisors – including attorneys, CPAs, bankers and brokers – on your consulting team.
For more information about how Sponsel CPA Group and McGuire Sponsel can assist you with incentives, please call Nick Hopkins at (317) 608-6695 or email [email protected]; or call Doug Dalton at (317) 296-6446 or email [email protected].