North Carolina ~ Corporate Income Tax: Job Development Investment Grant Program Expanded

North Carolina corporate income tax legislation has been enacted to expand the job development investment grant program. The maximum amount of total annual liability for grants awarded in any single calendar year is $20 million (previously, $15 million) for a year in which no grants are awarded for a high-yield project and $35 million for a year in which grants are awarded for a high-yield project. A “high-yield project” is defined as a project for which the agreement requires that a business invest at least $500 million in private funds and create at least 1,750 eligible positions. The sunset date is extended from January 1, 2016, to January 1, 2019. The amount of the grant is a percentage of withholding of eligible positions. The percentage is capped at 80% for tier 1 and 75% for other areas (previously, the percentage was a minimum of 10% and a maximum of 75%). It may be 100% for high-yield projects under certain circumstances. The grants may last for up to 20 years for high-yield projects and 12 years for other projects (previously, 12 years for all projects). A business may apply for a grant if a minimum number of positions is created. In tier 3, this is increased from 20 positions to 50 positions.

Sales and use tax provisions contained in the bill were reported previously. (TAXDAY, 2015/10/02, S.20)

H.B. 117, Laws 2015, effective July 1, 2015, and applicable to awards made on or after that date

 

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Wolters Kluwer Tax and Accounting

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