Urgent Action Required – California Enterprise Zone Program Credits
2013 will be the last tax year for which businesses may engage in qualified Enterprise Zone hiring or purchasing under the current Enterprise Zone Program. You should document as much Enterprise Zone tax benefits as possible now to preserve credits for the ten year carry forward period.
Legislation to replace this program eliminates the TEA (Targeted Employment Area), the types of business that qualify are drastically reduced, and you will only be able to capture credits on current year hired employees.
Several team members from Bressler & Company recently attended a presentation by the Kings County Economic Development Corporation, the local organization that facilitates the program, and we wanted to update you on some of the latest information we received.
1) Tax Credit Carry Forward – You may carry over unused credit to future years until the credit is exhausted. Credits accumulated as of 12/31/13 can be carried forward up to ten years. Hiring Credits can continue to be earned after 12/31/13 if hired by that date.
2) New TEA Zone – The “Targeted Employment Area” (TEA) Zone was revised and reduced effective January 1, 2013, but the old zone may still be used for employees hired through July 8th. Any employees hired on or after July 9th must reside in the new TEA Zone to qualify.
The Kings EDC is expecting a large volume of vouchers to be submitted close to the end of the year. They are not sure whether or not vouchers submitted and/or processed after 12/31/13 will even be honored. Time is running out to secure your previous EZ tax credits. Therefore, we strongly urge you to fax your paperwork into us as soon as possible so we can submit your vouchers before the rush hits.
As always, if you have any questions, just give us a call at 559.924.1225. We’re always happy to speak with you.
