Incentives

Establishing or relocating your higher wage paying operations to Georgia can qualify your firm for an advanced job tax credit (up to $5,000 per job per year for five years, if the new jobs pay 110 percent or more  the county average wage rate). The tax credit can be used against 100 percent of corporate income tax liability regardless of where the taxpayer locates. Credits not applied to income tax liability may be monetized through retention of employee quarterly withholding taxes.

A credit good against Georgia Corporate Income Tax liability. The amount of the credit varies from $1,250 to $4,000 per job per year, depending on the county in which a facility is located. Jobs must be pre-qualified as eligible. The credit is valid for a period of five years.

A one-time 1% tax credit on a minimum capital investment of $50,000 for manufacturers and telecommunications firms that have operated a production facility in the state the previous three years is offered in metro Atlanta counties. A taxpayer must choose either the regular or optional investment tax credit.

Many counties in Metro Atlanta will offer 10-year periods of property tax relief, negotiated on a case-by-case basis. Typically offered only in conjunction with the use of revenue bonds, this type of incentive is predicated on the number and quality of jobs created and the amount of the financial investment.

Georgia's highly acclaimed Quick Start training program offers sophisticated customized training jointly developed with your company. This cost-free program covers development and delivery of all training conducted in your facilities or in a state-of-the-art vocational-technical college. The Chamber's Economic Development staff will work directly with you and Quick Start to ensure a full exploration of all training that may be provided to your company.

A tax credit is allowed for research expenses for research conducted within Georgia for any business or headquarters of any such business engaged in manufacturing, warehousing and distribution, processing, telecommunications, tourism, and research and development industries. Taxpayer must qualify for a research credit under Section 41 of the 1986 IRS code to be eligible for the Georgia credit. The credit shall be 10% of the additional research expense over the "base amount". The tax credit may be carried forward 10 years but may not exceed 50% of the business's net tax liability in any one year. Emerging companies will be allowed their first 5 years to use this credit against payroll withholding. (New in 2009.)

The retraining tax credit allows some employers to claim certain costs of retraining employees to use new equipment, new technology, or new operating systems. The credit can be worth 50% of the direct costs of retraining full-time employees up to $1,250 per employee for all approved retraining per year (new in 2009). The credit cannot be more than 50% of the taxpayer’s total state income tax liability for a tax year. Credits claimed but not used may be carried forward for 10 years.

The training must:
1. enhance the skills of employees otherwise unable to function effectively on new equipment;
2. be approved by the Department of Technical and Adult Education; and
3. be provided at no cost to the employee.

NEW QUALIFYING REGULATIONS HAVE YET TO BE WRITTEN The credit cannot be more than 50% of the taxpayer's total state income tax liability for that taxable year. Any credit claimed for any taxable year beginning on or after January 1, 1998 but not used in any such taxable year may be carried forward for 10 years from the close of the taxable year in which the tax credit was granted. Credit must be claimed within one year of the earlier of the date the return is filed or the extended due date.
 

Georgia provides several exemptions for its sales and use tax on corporations including:

• Purchases intended for resale
• Machinery used directly in the manufacturing or production process (such machinery purchase must be made by a Georgia company, after filing a sales tax exemption application; the machinery maker does not need to be a Georgia company)
• Manufacturing machinery replacement parts, costing up to $150,000 per part.
• Primary material handling equipment is exempted from sales tax if a company invests $5 million or more in a new or expanded facility; equipment covered is:

1. The principal machinery and equipment used to lift or move tangible personal property in a warehouse or distribution facility located in this State.
2. The computer software and hardware whose purpose is to lift or move tangible personal property qualifies for the exemption.
3. "Racking system" means any system of machinery equipment, fixtures or portable devises whose function is to store, organize, or move tangible personal property within a warehouse or distribution facility, including, but not limited to conveying systems, chutes, shelves, racks, bins, drawers, pallets, and other containers and storage devices which form a necessary part of the facility's storage system.

• Sale of fuel and supplies for use or consumption on board ships plying the high seas in foreign or interstate commerce
• Property manufactured for export when delivery is taken outside of Georgia
• Transportation equipment manufactured for exclusive use outside the state
• Items used in packaging
• Air/water pollution machinery and equipment
 

The City of Atlanta and certain other municipalities have created 6 Tax Allocation districts to encourage development in areas not currently experiencing growth. A Tax Allocation District, typically referred to as Tax Increment Financing, is a tool used to publicly finance redevelopment activities in underdeveloped or blighted areas. A tax allocation district derives its funding from the increase in the redevelopment area’s ad valorem and/or sales taxes levied by the city, county, and school system. These revenues are placed in a special redevelopment fund for the area and are used to directly pay for the redevelopment costs or to issue bonds to pay for redevelopment costs. The following TAD’s are currently in place and your Metro Atlanta Chamber Economic Development project manager can help your company evaluate potential advantages by locating in such a district.

New 2004 legislation creates a program within the State’s Job Tax Credit Program of “Opportunity Zone” tax credits. The OZ Tax Credit Program authorizes the Dept. of Community Affairs to designate as a “less developed area” an area that has 15% or greater poverty, within an enterprise zone, where an urban redevelopment plan exists. State resources are directed towards these “pockets of poverty” in a way that can be supplemented by federal programs that DCA administers.

Opportunity Zone Tax Credit Benefits:
• the maximum Job Tax Credit allowed under law
• use of Job Tax Credits against 100 percent of income tax liability and withholding
• expansion of the definition of “business enterprise” to include all businesses of any nature
 

Freeport (county inventory) tax exemptions
Childcare tax credits
Advanced training from the State University System (ICAPP)
 

State sales tax is exempted on manufacturing machinery, computer equipment used in high tech operations, equipment and materials used in clean rooms, material handling equipment, and more