Job Growth Incentive Tax Credit
The Job Growth Incentive Tax Credit (JGITC) provides a state income tax credit equal to 50% of the Federal Insurance Contributions Act (FICA) paid by the business on the net new job growth for each calendar year in the credit period.
The JGITC is an eight-year job creation incentive to support competitive, multi-state or country relocation and expansion projects. This tax credit is performance-based, meaning companies that underperform in job creation or wages will not receive the total credit amount.
If the issued tax credits exceed the business’s income tax liability for the tax year in which the credit is being claimed, the amount of the unused tax credit shall not be allowed as a refund, but may be carried forward and applied in each of the ten succeeding income tax years. The tax credit must be applied to the earliest tax return possible.
All companies who receive a JGITC will also be eligible for the Location Neutral Employment (LONE) Incentive, which is a cash incentive for all net new remote rural employees that support the urban project.
Eligibility
Companies must meet the following requirements:
- Create at least 20 net new jobs in Colorado during the credit period with an average annual wage of at least 100% of the county’s average annual wage where the project will be located.
- Consider at least one other state or international market for the project.
- Receipt of the credit is a major factor in its decision to locate in Colorado.
The project must meet the following requirements:
- could reasonably and efficiently locate the project outside of Colorado
- has a reduced probability of commencing in the state without this incentive
- be actively considered in multiple states and/or countries, meaning additional qualitative and quantitative information that supports the competitiveness of the project may be requested
All net new jobs must be maintained for at least one year after the positions are hired. The minimum average annual wage is set when the project is approved and does not change for the term of the incentive and credit period.
A business may not start or announce the proposed project in Colorado, including locating or expanding in the state, hiring employees related to this project, executing a lease agreement, or making material expenditures for this project, until a final application has been submitted and approved by the Economic Development Commission (EDC).
Businesses already receiving a Strategic Fund Incentive may not receive a JGITC for the same permanent net new jobs.
Enhanced Rural Enterprise Zones
If the company’s project falls within an Enhanced Rural Enterprise Zone, the net new jobs requirement drops from 20 to 5.
Application Process
Businesses interested in requesting a Job Growth Incentive Tax Credit commitment should contact our Global Business Development staff to preliminarily determine if the business meets the requirements.
Reid Aronstein
Global Business Development Manager
Industries: aerospace, financial services, transportation & logistics, bioscience, tourism, electronics, creative industries
Email Reid