What Is A California Enterprise Zone, And What Can It Do For Your Business?

                                                                                         

California tax incentives can save your California-based business a great deal of money, and yet many business owners do not take advantage of the savings. The best California tax incentives are available for those businesses working in what are classified by the state of California as enterprise zones. If your company conducts business within one of forty-two enterprise zones located throughout the state, you may qualify for several different kinds of California enterprise zone tax credit.

What Qualifies As A California Enterprise Zone?

There are forty-two enterprise zones in the state of California. These zones have been identified by the state as areas that are economically disadvantaged. With this California enterprise zone designation, the state wants to help these areas by bringing business to them. This, in turn, will help to bring jobs to the area, and will assist in improving the local economies there, and will aid in benefit to the California economy as a whole. In order to enable all of these advantages to occur, the state has put in place the enterprise zone tax credit.

There are two major tax credits that fall into this category that offer a great benefit to businesses located within the enterprise zones. The first is the hiring enterprise zone tax credit, and the second is the sales tax California enterprise zone tax credit.

How Can A California Enterprise Zone Tax Credit Help My Business?

If your company is located within any one of the state's enterprise zones, you will qualify for these tax credits. The hiring California tax credit can be obtained when you hire veterans, people with economic or physical disability, as well as Native American Indians, Pacific Islanders and American Samoans. By doing so, your empowerment zone company can qualify for up to $12,500 per designated employee. You can also apply for this benefit for anywhere from fifteen to up to fifty percent of your employee base, and this California enterprise zone tax credit can be retroactive for up to four years of amended tax returns. By taking advantage of this California tax credit alone, many small and medium-sized enterprise zone businesses can earn $200,000 and more.

The other California tax credit that your company can earn has to do with sales tax credit for capital assets. If you purchase assets that can include energy, pollution and air control equipment, research and development, as well as manufacturing or processing equipment, your company may save up to ten percent of the capital expenditure's after-tax cost.

For more information about the California enterprise zone and how it can help your business, contact your CPA today.

About the author:
Wayne Hemralick writes about-- A california enterprise zone tax credit.

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