Multi-State Tax Credits & Incentives

In the current competitive economic environment, states continue to compete against each other to lure companies (and their employees) to the “right” state. Many states offer lucrative credits and incentives to do so.

We assist companies with the identification, quantification and substantiation of multi-state benefits available as a result of expansion, including:

  • Increases in company headcount and training (ie. Hiring Credits, Training Credits, Grants and Reimbursement programs)
  • Investments in property, plant and equipment (ie. investment tax credits)
  • Increases in research and development activities (ie. R&D credits)
  • Expansions in enterprise zones, renaissance zones, or similar targeted areas

In general, tax credits focus on current (and sometimes retroactive) income tax benefits available to companies that meet specific factual requirements as set out by state statutes and regulations in a particular state. If a company clears those hurdles, they are often able to take advantage of hiring credits, investment credits and enterprise zone credits for doing business within the jurisdiction. The specifics obviously vary from state to state.

Negotiated incentives are contracted for directly with the state before a company expands into a given state. Oftentimes, a company might pit one state against another to secure the best incentives. Negotiated incentives are therefore oftentimes more flexible and can come in various forms, including infrastructure support, special financing arrangements, tax rebates, etc.

Most states have some kind of credit or incentive programs. In our home state of California, the legislature recently enacted three new programs (replacing the long-running California enterprise zone program) detailed here.

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