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Enterprise Zone Tax Credits

Businesses located in an Enterprise Zone can be eligible for up to 10 different state tax credits. See the fact sheet for a list of incentives, credit amounts and information.

Pre-certify First

Pre-certification is validation that your business is located in an Enterprise Zone and that Enterprise Zone Tax credits are a factor to the start-up, expansion or relocation of your business. Legislation requires (EZ) businesses to obtain pre-certification prior to engaging in an activity to earn an EZ tax credit each tax year. Pre-certification is required for Department of Revenue forms DR0074, DR0076 and/or DR0077. It is suggested that any business that may be planning on using one or more of the credits during the year complete the pre-certification in early January. Submitting information for pre-certification does not obligate the business to actually earn or use the credit(s).

Pre-certification (generally beginning of income tax year) and regular Certification (end of income tax year) both require approval by the Southwest Enterprise Zone Administrator and will need to be filed electronically. To pre-certify or certify, click here.

LIST OF ENTERPRISE TAX ZONE CREDITS

EZ – Investment Tax Credit: Businesses investing in Enterprise Zones through business personal property can earn a 3% tax credit. Special rules for renewable energy equipment apply.

EZ – Job Training: Companies that implement a qualified job-training program for their enterprise zone employees may earn an income tax credit of 12% of their eligible training costs.

EZ – New Employee Credit: Businesses increasing their workforce may earn a state income tax credit $1,100 per net new employee.

EZ – Agricultural Processor: An additional tax credit of $500 per net new employee may be claimed by businesses adding value to agricultural commodities through manufacturing or processing.

EZ- Enhanced Rural EZ: An additional tax credit of $2,000 per net new employee may be claimed for businesses in Enhanced Rural EZs – these are re-established every 2 years.

EZ – Enhanced Rural Agricultural Processor: An additional tax credit of $500 per net new employee may be claimed if the business is an agricultural manufacturing or processing business in an Enhanced Rural EZ.

EZ – Employer Sponsored Health Insurance: Offers businesses $1,000 per net new employee insured under a qualified health plan for which the employer pays at least 50% of the cost. This credit is available for the first two years the business is located in an enterprise zone.

EZ – Research and Development Tax Credit: Businesses conducting research and development may earn a 3% tax credit on the increase in such expenditures as compared to that of the prior 2 years.

EZ – Vacant Commercial Building Rehabilitation: Encourages redevelopment of vacant commercial property with a 25% credit for the cost of rehabilitation of a building that is at least 20 years old and has been completely vacant for at least 2 years.

EZ – Commercial Vehicle Investment Tax Credit: Investment in commercial trucks, truck tractors, tractors, or semitrailers, and associated parts registered in CO and based and used in an EZ may earn the taxpayer a 1.5% credit.