New Funding Source for Your Clients!
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Even before the jolting business headlines and economic upheavals of the past couple of weeks, we heard several clients comment on how hard it is getting to obtain loans from banks. Sources of funding to expand or improve businesses are drying up as we speak, and many of your clients may be impacted.
Companies are responding by freezing employment levels, delaying capital investments, and reducing spending on categories such as training. But as you may have guessed, we know of an often-overlooked source of ready funds - Georgia income tax credits!
And another thing. When we discuss tax credits, prospects typically think about the current year or plans for the future. But what happened in the past could provide huge tax credit potential. Most of the credits can be obtained for activities that occurred up to 3 years ago, and certain job tax credits can be captured for activities that occurred 8 years ago!
As you may already know, tax credits for current-year activities may be obtained immediately or within a very short time. Credits for past years' activities as reflected in amended returns may be obtained at the time of refund from the Department of Revenue, which is presently averaging around three months. That beats any loan, at any rate, on any terms!
How many clients do you have who are seeking funds to expand or improve their businesses? Ask them, "What would you do with substantial extra funds $$ to expand or improve your business?" Let us know how they responded here.
We will provide a summary of responses in an upcoming issue of Alpha-Mail. Thanks in advance for your help.
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Quick Updates
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There has been a minor change regarding the Retraining Tax Credit (RTC). The Department of Technical and Adult Education (DTAE), which is reponsible for approving RTC submissions, has changed its name to the Technical College System of Georgia (TCSG). The Retraining Tax Credit guide and related application and completion forms have been revised, and you can access these on the Georgia Retraining Tax Credit Guide web site here.
Several other TCSG budget-related changes have recently been announced, including a major consolidation effort affecting 14 schools. You can catch up on some of the changes under the News tab on the TCSG web site here. Many offices and activities are cutting back to 4-day work weeks, and many positions will be cut. There are rumors of other changes, so stay tuned for updates. |
New Opportunity Zone Tax Credit "Opportunities"
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Clumsy headline? Yes, but these opportunities are real! Opportunity Zone Tax Credits were created in 2004 to provide additional opportunities within the State's Job Tax Credit Program. In 2008, the General Assembly passed and the Governor signed an amendment (HB 1273) that streamlined the program, expanded the areas and businesses eligible for the Zones, and lowered the job creation threshold. The Opportunity Zone Tax Credit Program authorizes the Department of Community Affairs (DCA) to designate as a "less developed area" an area within or adjacent to a census block group with 15% or greater poverty where an enterprise zone or urban redevelopment plan exists. Opportunity Zones are intended to encourage development, redevelopment and revitalization in areas that have higher levels of poverty and are underdeveloped or suffer from blight.
Highlights of the Opportunity Zone Tax Credit Incentives -
- Significantly expanded definition of Opportunity Zone designation
- The maximum Job Tax Credit allowed under law - $3,500 per job per year for up to five years
- The lowest job creation threshold of any job tax credit program - ONLY 2 jobs
- Use of Job Tax Credits against 100 percent of state income tax liability, with any excess available to use against withholding taxes
- Expansion of the definition of "business enterprise" to include any lawful business
The Department of Community Affairs provides the details, rules, maps, and other information on their web site here.
Some of your clients may have significant new opportunities for tax credits resulting from these changes. As I mentioned to you last month, you need to identify ALL of your clients located in Opportunity Zones. Thanks!
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Upcoming Alpharesults Events...
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We frequently speak about Georgia business tax credits to individual CPA firms as well as Georgia Society of CPAs chapter meetings. We hope to see you at one of the following upcoming presentations:
September 26, 2008 - GSCPA Coastal Georgia Chapter lunch. Click here to register.
October 16, 2008 - GSCPA Northwest Georgia Chapter dinner. Click here to register
October 21, 2008 - GSCPA Southside Chapter dinner. Click here to register.
October 23, 2008 - GSCPA Albany Chapter dinner. Click here to register.
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About Us
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Alpharesults has assembled a team with the specialized knowledge and approach required to obtain Georgia income tax credits. We are not a public accounting firm. Rather, our services complement those of public accounting firms and do not create conflicted loyalties, because our professionals do not perform attestation work or other external audit functions.
We focus on small to medium-sized businesses and work exclusively in Georgia with a wide variety of in-state and out-of-state accounting firms. For more information on our services, follow this link.
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