Merced County voted to expand the Merced County Regional Enterprise Zone. An additional 1,877 acres of county land were added to the enterprise zone, which has kept 3,130 jobs in Merced County and created 692 new jobs, according to Mark Hendrickson, the county’s director of economic development. The enterprise zone designation comes from the state Department of Housing and Community Development and provides tax incentives for businesses in the zone.

The Enterprise Zone Program targets economically distressed areas throughout California. Special state and local incentives encourage business investment and promote the creation of new jobs. The purpose of the program is to provide tax incentives to businesses and allow private sector market forces to revive the local economy.  Oroville is one of the few communities in the State that holds a designation for both a Recycling Zone and Enterprise Zone.

Enterprise Zones are state-designated economic development areas created to stimulate growth and create jobs and stimulate investments in local communities. Through tax incentives, hiring incentives, financial incentives, etcetera, the Enterprise Zone is designed to add to a business’s bottom line.

Oroville Enterprise Zone Hire Tax Credit
A qualified business may reduce state income taxes by the amount of wages paid to one or more qualified employees. The local Private Industry Council coordinates the eligibility verification for employers.

During the first year of employment, up to 50% of a qualified employee’s wages may be claimed against your California income tax liability. The credit percentage decreases by 10% annually. The employer’s deduction for wages must be reduced by the amount of the credit claimed.

The hiring tax credit calculation is based on the lesser of:

• The actual hourly wage paid; or
• 150% of the California minimum hourly wage, i.e. $8.00 x 1.50 – $12.00.

Employees must spend at least 90% of their work time on activities directly related to the conduct of business in the enterprise zone and perform at least 50% of the work within the zone boundaries.

Oroville Enterprise Zone Sales and Use Tax Credit
Businesses located in the Enterprise Zone may reduce state income taxes by the amount of sales or use tax paid on certain machinery purchased for exclusive use within the Enterprise Zone.

To qualify for the credit, the machinery must be used to manufacture, process, combine or otherwise fabricate a product; produce renewable energy resources; or control air or water pollution. Data processing and communication equipment are also qualified property.

Individuals and Partnerships may claim a credit equal to the tax paid on the first $1 million of machinery costs.

Corporations may claim a credit equal to the tax paid on the first $20 million of machinery costs. Special rules apply for S-Corporation shareholders.

Oroville Enterprise Zone Business Expense Deduction
Businesses operating within the Enterprise Zone may elect to treat 40% of the cost of qualified property as a business expense. The maximum deduction in the Oroville Enterprise Zone is $20,000. Therefore, this particular provision is only of benefit to C-Corporations.

Oroville Enterprise Zone Net Operating Loss Carryover
If a net operating loss is generated by a business that operates within the Enterprise Zone, 100% of the loss may be carried forward for up to 15 years.

Oroville Enterprise Zone Net Interest Reduction for Lenders
Lenders who loan money to an Enterprise Zone business can take a deduction for the net interest earned (interest earned less direct expenses) on the loan.

The types of loans that qualify for this deduction include: business loans, mortgages, and loans from non-commercial sources.

To Qualify for the Loan Interest Earned Deduction:

• The loan must be made to a trade or business located solely within the boundaries of the Enterprise Zone.
• The Loan proceeds must be used strictly for the business activities within the boundaries of the Enterprise Zone.
• The lender cannot have an equity or other ownership interest in the business.

The city of Brawley voted 4-1 to look at a county-wide application to the state’s enterprise zone program. This is not a full commitment, but it is a step in the right direction for the region.

With declining job rates, city managers are beginning to realize that dramatic measures need to be taken in order to revitalize the local economy and begin attracting outside businesses.

“It would be a great opportunity to expand the scope of the enterprise zone,” County Planning Director Jurg Heuberger said. Heuberger also added that it would allow California the chance to grant a new enterprise zone if the IVEZ combined with the Calexico County Enterprise Zone (CCEZ).

April 1st may be April Fool’s day, however the city of Hesperia was celebrating since it marked the beginning of the region’s enterprise zone benefits. Starting April 1st, Hesperia local businesses were able to start taking advantage of the EZ tax credits, including: hiring credits, sales and use tax credits as well as business expense deductions.

“It’ll hopefully not only bring in new jobs, but also help people expand existing businesses,” City Manager Mike Podegracz said Friday.

This is very exciting for a city like Hesperia, since it will now be able to compete directly with larger cities in attracting new businesses to move to the area. This should also mean good things for the job rate in Hesperia, since local businesses will be able to apply for a number of different hiring credits.

If you have a business in the Hesperia area, contact us today to see which credits are available to you.

Santa Clarita is the fourth largest city in Los Angeles County. The California Department of Finance estimated the city population as of January 1, 2008 at 177,045. Including unincorporated areas of the Santa Clarita Valley, the population is estimated at over 275,000. It is located about 35 miles northwest of downtown Los Angeles, and occupies most of the Santa Clarita Valley. It is a notable example of a U.S. edge city or boomburb. The FBI rates it as the sixth safest city in the United States with at least 100,000 inhabitants. (Nearby Simi Valley and Thousand Oaks, in Ventura County, traditionally alternate between the first and second spots on the list.) Santa Clarita is ranked as one of the top 100 places to live by Money.

Santa Clarita’s most notable attractions are the Six Flags Magic Mountain amusement park located just outside the city limits in unincorporated Los Angeles County, and the California Institute of the Arts (CalArts), located in Valencia.

If you have a company in this area, you may qualify for the State’s Enterprise Zone tax credits.  To see if you qualify, click here.

Considering that California has one of the highest unemployment rates in the nation, it is about time that companies begin taking advantage of the enterprise zone hiring tax credits. Reports are showing that businesses operating in the San Bernardino enterprise zone region increased their hiring-related tax credit usage in 2009 compared to previous years.

Andrew Edwards, from The Sun, reports, “In 2009, managers of 99 businesses requested some 940 hiring vouchers, and 857 of those requests were approved. That’s about 57 percent more requests than 75 businesses filed in 2008.  Enterprise zone officials maintain that the hiring credits and other tax incentives made it possible for firms to create 132 new jobs and keep another 725 on the books.  The 99 firms that sought tax incentives during the past year represent only a slice of businesses that could be eligible for enterprise zone-related perks.”

If your business in in San Bernardino or Colton, you may be eligible for numerous tax credits, contact us today to find out which tax credits you can apply for.

Santa Ana, CA, has a rich commerce heritage. One of Santa Ana’s most notable businesses is the Rickenbacker musical instrument company, whose electric guitars and bass guitars earned fame in the hands of many rock and roll legends. Santa Ana is also the home of the First American Corporation and Ingram Micro, and the original Glenn L. Martin aviation company, which later merged with the Lockheed Corporation to form the largest aircraft and weapons manufacturing corporation on the planet, Lockheed Martin.

If you are joining the ranks of these prestigious companies in Santa Ana and want to see what types of tax benefits you can take advantage of, please contact us for a free consultation.

The Los Angeles Mid-Alameda Corridor Enterprise Zone encompasses the entire City of Huntington Park. On the October 15, 1986 the City of Huntington Park was designated as an Enterprise Zone by the State of California.  Businesses already in the Zone can qualify for benefits, as can new businesses relocating or expanding into the Huntington Park area.

Incentives

Incentives of the Enterprise Zone program include:

• Sales and Use Tax Credit:
  California income or franchise tax may be reduced by the amount of Sales or Use Tax paid on certain machinery purchased (for exclusive use in an Enterprise Zone).
  $1.45 million or more per year in tax credits is available for qualifying machinery.
• Hiring Credit:
  A qualified business may reduce its state income tax by the amount of wages paid to one or more qualified employee(s) over a five-year period. $23,400 or more in tax credits is available per qualified employee. Some of these employees may also qualify an employer for a Federal tax credit, Worker Opportunity Tax Credit (WOTC), of up to $2,100.
• Business Expense Deduction:
  Part of the cost of the certain property purchased for exclusive use in the Enterprise Zone may be deducted as a business expense in the first year it is placed in service. (Amount of deduction changes annually; call for current value).
• Net Operating Loss Carryover:
  Up to 100% Net Operating Loss (NOL) Carryover for individuals or corporations doing business in the Enterprise Zone may be carried over for up to 15 years to reduce the amount of taxable income generated within the Enterprise Zone for those years.
• Net Interest Deduction for Lenders:
  A deduction from income is allowed on the amount of “net interest” earned on loans made to a trade or business located exclusively in the Enterprise Zone.

This is a great city to do business in, and on the October 15, 1986 the City of Huntington Park was designated as an Enterprise Zone by the State of California.  Businesses already in the Zone can qualify for benefits, as can new businesses relocating or expanding into the Huntington Park area.

What specific Incentives for businesses operating in this zone?

Incentives of the Enterprise Zone program include:

• Sales and Use Tax Credit:
  California income or franchise tax may be reduced by the amount of Sales or Use Tax paid on certain machinery purchased (for exclusive use in an Enterprise Zone). $1.45 million or more per year in tax credits is available for qualifying machinery.
• Hiring Credit:
  A qualified business may reduce its state income tax by the amount of wages paid to one or more qualified employee(s) over a five-year period. $23,400 or more in tax credits is available per qualified employee. Some of these employees may also qualify an employer for a Federal tax credit, Worker Opportunity Tax Credit (WOTC), of up to $2,100.
• Business Expense Deduction:
  Part of the cost of the certain property purchased for exclusive use in the Enterprise Zone may be deducted as a business expense in the first year it is placed in service. (Amount of deduction changes annually; call for current value).
• Net Operating Loss Carryover:
  Up to 100% Net Operating Loss (NOL) Carryover for individuals or corporations doing business in the Enterprise Zone may be carried over for up to 15 years to reduce the amount of taxable income generated within the Enterprise Zone for those years.
• Net Interest Deduction for Lenders:
  A deduction from income is allowed on the amount of “net interest” earned on loans made to a trade or business located exclusively in the Enterprise Zone.

The City of Brawley is in the heart of the Imperial County, which is located in the s­outh­eastern part of the State of California. It is situated approximately 210 miles southeast of Los Angeles, 126 miles east of San Diego, and 30 miles north of Mexicali, Mexico. Brawley is a general law city incorporated in 1908 and has a Council Manager form of government. The 20­07 population is estimated to be 25,694 as reported by the State Department of Finance.

The city of Brawley has a wide range of business credits, if you have a company in the city, please contact us to see which credits you qualify for.