The State of California has several programs, opportunities and business friendly policies for companies interested in establishing a California operation.
California Alternative Energy & Advanced Transportation Authority (CAEATFA) Sales & Use Tax Exemptions for Zero Emission Vehicle (ZEV) Manufacturing: Purpose is to provide industry in California with different methods of financing alternative energy and advanced transportation technologies. Since the passage of SB71, in April of 2010, the program has been expanded to all renewable energy technologies. More information available at: http://www.treasurer.ca.gov/caeatfa/sb71/index.asp
Enterprise Zone (State Program)
Businesses located within California’s enterprise zone(s) are eligible for substantial tax credits and benefits including:
- Up to 100% Net Operating Loss (NOL) carry-forward. NOL may be carried forward
- 15 years (suspended for tax years 2002 and 2003);
- Firms can earn up to $37,440 in state tax credits for each qualified employee hired;
- Corporations can earn sales tax credits on purchases of $20 million per year of qualified machinery and machinery parts;
- Up-front expensing of certain depreciable property. Lenders to Zone businesses may receive a net interest deduction;
- Unused tax credits can be applied to future tax years, stretching out the benefit of the initial investment;
- Enterprise Zone companies can earn preference points on state contracts.
Employment Training Panel (ETP)
A company may be eligible for a contract with ETP to help assist with post-hire training reimbursement. If the proposed training qualifies and meets ETP’s eligibility criteria a contract will be developed.
The Employment Development Department, in partnership with Local Workforce Investment Area, may assist recruit, screen, and test, evaluate and hire qualified employees.
Research & Development Tax Credit
This State Tax Credit is designed to encourage companies to increase their basic research and development activities in California, the research and development tax credit allows companies to receive a 15 percent credit against their bank and corporation tax liability for qualified in-house research expenses, and a 24 percent credit for basic research payments to outside organizations.
Industrial Development Bonds
Congress created tax-exempt Industrial Development Bond (“IDB”) financing to promote investment in land, buildings and new equipment associated with domestic manufacturing and processing operations.
Elective Single Sales Factor
California currently uses a triple apportionment corporate income tax structure method for assessing taxes on businesses. This tax system weighs a company’s payroll, property, and sales when apportioning taxes. Beginning January 1, 2011 California companies will have the option to use the single sales factor method for corporate income tax.
And many more....
For the complete list of California Incentives:
Download the California Investment Guide