Georgia Department of Community Affairs Job Tax Credits in an Opportunity Zone

Benefits for Business Job Tax Credits Georgia Income Taxes Georgia Withholding Taxes Credits Offset Opportunity Zone

2004 Initially created 2008 Amended Opportunity Zone Legislation

Benefits to the Community REDEVELOPMENT

JOB CREATION Benefits to the Community

Opportunity Zone Criteria An area within or adjacent to a census block group with a poverty rate of 15 percent or greater An area within or adjacent to a census block group with a poverty rate of 15 percent or greater Within a State Enterprise Zone or Urban Redevelopment Plan area Within a State Enterprise Zone or Urban Redevelopment Plan area Area must display pervasive poverty, underdevelopment, general distress and blight. Area must display pervasive poverty, underdevelopment, general distress and blight.

Currently Designated Areas Union City MonroeGriffin Washington Payne City Milledgeville Perry Hawkinsville Cuthbert Tifton Ocilla Quitman Darien

Opportunity Zone Job Tax Credit  Business entity = any lawful business, including retail (retail is generally excluded from the Job Tax Credit)  Jobs Creation Threshold = 2 net new jobs to Georgia (may not be husband and wife)  Credit = $3,500 per net new job which may be claimed for five years as long as the job is maintained

Calculation of the Tax Credit Business creates 2 net new jobs Business creates 2 net new jobs Business maintains the jobs for 5 years Business maintains the jobs for 5 years Total possible credit = $35,000 for 2 jobs Total possible credit = $35,000 for 2 jobs $3,500 Tax credit per job x2 jobs x5 years $35,000 Total Credit

Example of OZ Credit Benefit Job Threshold met in 2009 or later Jobs Created Credit Tax LiabilityWithholding Jobs Created Credit Tax LiabilityWithholding Year 12$ 7,000 $ 1,200 $ 5,800 Year 23$10,500 $ 1,000 $ 9,500 Year 33$10,500 $ 1,500 $ 9,000 Year 44$14,000 $ 1,700 $12,300 Year 54$14,000 $ 2,100 $11,900 Year 65$ 7,000 $ 2,050 $ 4,950 Year 75$ 3,500 $ 1,800 $ 1,700 Year 86$ 3,500 $ 1,750 $ 1,750 Year 96$ 0 $ 0 $ 0 TOTALS$70,000 $13,100 $56,900 In the above example, a Job Tax Credit of $70,000 is generated, with each net new job eligible to claim the credit for five years and the business able to utilize all of the credit

Steps to Claim the Tax Credit 1) Meet the Eligibility Criteria 2) Complete and file the Opportunity Zone Certification Form with DCA 3) File Form IT-WH with the Department of Revenue (DOR) 4) File original Georgia Income Tax Return, along with Form IT-CA, with DOR by the due date Withholding credit may be claimed only after DOR validates the credit

Opportunity Zone Certification From Section I

Opportunity Zone Certification From Section II

Opportunity Zone Certification From Section III

Business creates the required number of net new jobs (minimum of 2) in Year 1, has the Opportunity Zone Certification Form completed and forwards it to DCA for acceptance Credits which may not be clamed against withholding (i.e. prior year carry forward, existing industry bonus) will carry forward to be used against future income tax liability DOR sends a letter to the business notifying of the amount of credit available to claim against WH and when to claim Business files its Georgia Corporation Income Tax Return with the Department of Revenue, including Form IT-CA to claim the Job Tax Credit Business files Form IT-WH with the Department of Revenue at least 30 days prior to the filing of the original Georgia Income Tax Return on which the credit will be claimed Business located within an Opportunity Zone area eligible for the withholding benefit – Business meets JTC eligibility Opportunity Zone Job Tax Credits to Withholding Business may claim the job tax credit on jobs from Year 1 on the Year 2 tax return for jobs created prior to 2009, or Year 1 jobs created in 2009 or later may claim jobs on the tax return for the year the jobs are created The Department of Revenue has 90 days from the date the tax return is filed to review the credit and make a determination of the amount eligible to claim against withholding Business begins claiming credit against withholding taxes, continue until credit is fully utilized or 10-year carry forward period expires

Forms, Maps and More…… please contact: Dawn Sturbaum (404) ols/programs/opportunityZones.asp \ available at: For Questions on Job Tax Credits