Answer: For businesses within Enterprise Zones, an amended tax return can be filed. Amended returns can be filed within four years from the original due date of the tax return, the date the tax return was filed, or within one year from the date the tax was paid, whichever is later. Essentially, that means you can look at the previous four years and compute the tax credits that your firm may qualify for. For businesses in federal zones (e.g. Empowerment Zones, Renewal Communities and Enterprise Communities), you can go back three years and calculate credits owed to you. Whether you are a business in an Enterprise or Federal zone, credits may be computed for the current year and subsequent years, as well. Once the Enterprise Zone credits are identified, they can be claimed until exhausted. They do not expire. The Federal Credits can be carried back one year and forward twenty until exhausted.

This is part 2 of 10 in a series of frequently asked questions and answers from C & I Tax Consultants. For more information, please contact us today.

We are also planning a Redevelopment Plan Amendment that will cover most of our planned growth areas. The expanded Project Area should capture significant new redevelopment property tax increment. Also, we have zoned enough industrial property to allow for at least 6,000 new jobs. For example, we are marketing a 72-acre industrial park and have a 27-acre city-owned industrial park that should receive $3.2 in Grant funding for the public infrastructure improvements. Finally, with the recent Enterprise Zone designation by the State of California, we should be able attract some quality light manufacturing, alternative energy, renewable fuels and other relative high-wage businesses.

Our General Plan Guiding Principles include:

• Conserve agricultural and natural resources
• Create a vibrant, healthy and active downtown
• Incorporate green and sustainable principles through the General Plan
• Encourage growth in existing developed areas with limited new growth in undeveloped areas of the Planning Area
• Promote attractive residential and aesthetically appealing commercial development
• Create a positive business environment for new and existing businesses to locate and expand
• Provide mobility, housing and job options for all residents of Taft

Diversify the local economy while remaining a leader in energy production and maintaining a strong petroleum-based industry

DailyCal.org reported the following, ‘Bates said city officials hope to overcome the deficit through a new enterprise zone in West Berkeley and the Downtown Area Plan in an effort to increase revenues and maintain the city’s financial status. Bates said the newly established enterprise zone, which was extended through Emeryville and Berkeley from Oakland, may provide an opportunity for new companies to expand and remain in the area. One such company, Bayer Corporation, will spend $100 million in new research and facilities, providing the possibility for the creation of new jobs. “This gives us a whole new arm,” he said. “It gives us an opportunity to provide tax incentives for people to hire locally.” ‘

The more city officials realize the importance of the EZ program, the better it will be for the state’s job market and overall budget crisis.

This beautiful city is also home to a California State Enterprise Zone, so if you have a business operating in this area, contact us to see if you qualify for corporate tax credits.

Below are some of the points he made:

State legislators need to understand that there is fierce competition for California companies from other more business-friendly states. A few years ago, when I was considering relocating my business, I was heavily recruited by New Mexico Gov. Bill Richardson, who is very pro-business. I was also recruited by other states such as South Carolina, West Virginia, Texas and Arizona. Most of these states had attractive offers for companies interested in relocating. For example, West Virginia offered to give my company 20 acres of land and also construct a building, which I would later own. Arizona offered to pay my employees’ wages for a year, at the prevailing state wage. In addition, many other states have low state taxes compared to California’s state tax which is 10 percent.

I realize that moving my business would have a devastating impact on the local economy. Cannon Safe employs 200 workers and our 2009 payroll contributed $7.2 million to the local economy. Manufacturing companies like Cannon Safe have a ripple effect on the local economy, because we also employ hundreds of local support businesses.

Cannon Safe also employs 500 vendors who provide trucking, freight, steel, legal and accounting services. Seventy percent of our gross sales goes back to the local economy, and that accounts for millions of dollars.

California enterprise zones also provide a significant economic impact to local communities. According to information from the California Association of Enterprise Zones (CAEZ) website:

• Enterprise zones have generated more than 700,000 jobs in a 10-year period.
• Wages and salaries in enterprise zones grew 3.5 percent more than the rest of the state.
• Poverty decreased 7.35 percent in enterprise zones compared to the rest of the state.

I love California, but I can’t continue to throw my money away.

“I applaud Mayor Villaraigosa and the city of Los Angeles on their continuing efforts to bring companies and jobs to the Los Angeles area. For our economy to recover we need the private sector to add jobs, and the proposed Business Tax Holiday and recent expansion of the East Los Angeles Enterprise Zone are two surefire ways to do exactly that. It’s great news that Baxter’s BioScience business has decided to continue its investment and preserve jobs right here in California as a direct result of the East Los Angeles Enterprise Zone expansion, and I look forward to celebrating the passage of the Business Tax Holiday and the new businesses it will bring to California.”

Villaraigosa issued this statement:

Today, I joined Governor Schwarzenegger to visit the site of a company that chose to stay in our great City and preserve 600 jobs for hard-working Angelenos.I want to thank Baxter BioScience for turning to our Office of Economic and Business Policy when they began to have doubts about Los Angeles being the best city for them to call home. I’m glad we made our case, and I think we proved that our jobs and economic development team — helmed by First Deputy Austin Beutner — is willing to go above and beyond the call of duty.

Since last February, my office has been meeting with Baxter to figure out we could do to keep their company and the vital jobs it has created here in Los Angeles.We listened to the employees of Baxter and learned how to develop and implement policies that will attract and retain businesses as well as create good-paying jobs right here in Los Angeles. And then we worked hard to actually make that vision a reality!

In fact, one particularly smart, business-savvy policy – the approval of Los Angeles’ State Enterprise Zone – directly contributed to Baxter’s decision to stay. When the East Side Enterprise Zone was expanded to include Baxter BioScience, the company was able to lower their operating costs with their newfound eligibility for special tax credits.

And this is happening to companies throughout the entire City, as we have aggressively expanded our enterprise zones, Los Angeles has gained the remarkable distinction of having the most acreage with enterprise zone designation – out of every city in California!

The bottom line here is that Baxter is just one example, since it is impossible to know how many other companies have decided to stay in LA and hire more people, because of the tax credits and deductions they gained from being in a Special Economic Zone.

Baxter’s represents the results-driven approach to our newly refocused Office of Economic and Business Policy.
And today, we have an exciting announcement that will give Los Angeles businesses another tool to help them thrive and grow: the Business Tax Holiday will attract new enterprise to Los Angeles by exempting them from any gross receipts tax for three years.

The effectiveness of tax holidays has been proven: my office commissioned a study at USC Business School that suggested the Business Tax Holiday would yield no loss in tax revenue. In fact, it would spur enough job growth to create more tax revenue. This tax holiday will create an estimated 55,000 new jobs with 12% unemployment, that is exactly the kind of jumpstart our economy needs.

I am proud of the fact that our office is leveraging every resource at our disposal to put Angelenos back to work, and I am thrilled that Baxter reached out to us and ultimately chose to stay in LA.

So on that note, I would like to thank Baxter again for believing in our City and for inviting us here today to celebrate a major milestone in their evolution as a company.

Cities with enterprise zones will be interested to know that LAO has proposed to eliminate tax benefits granted to businesses in enterprise zones as a cost savings measure. While this proposal has not been adopted in any pending budget proposal, its existence -along with SB 974 (Steinberg), which would shift enterprise zone tax credits to other purposes, is of concern. SB 974 is opposed by the League and many business organizations.

For a copy of the LAO’s analysis of the Governor’s May Revise visit their Web site.

Several recent economic studies have attempted to measure the true impact of California’s Enterprise Zone program. The results are, as they say, mixed. This has led some to call for elimination of the program in order to recapture the “lost tax revenues.” Though these studies provide a thorough hindsight view, it is important to include a forward looking perspective of the business climate that California faces before considering any changes to California’s enterprise zones.

There’s an old cliché about not seeing the forest for the trees. You can extend that perspective a bit like this: If you use a magnifying glass to carefully analyze a single oak tree in the forest for several days at a time, you won’t see it grow. Your conclusion would then be that the tree isn’t growing and by extrapolation, there is no hope for the tree or the forest. Sometimes you need to back up a bit.

Looking forward and not back, California has double-digit unemployment now and likely will for many years to come. States all around the country are competing for employers. The tax advantages of our enterprise zones are one of our very best and most effective tools for bringing employers to the state. As the biggest state in the union, we need the most jobs. Anything that worsens the business climate and job picture in California – and that includes even talking about eliminating the enterprise zones – is, to be blunt, insane.

The bill, SB 939, started by Senator Sam Aanestad (R-Grass Valley), was placed on ‘Suspense File’ by state democrats last month, stopping the bill in its tracks.

“The Democrats have once again proven that they are the Party of No when it comes to new job and new business creation,” said Senator Aanestad. “With the California unemployment rate at an all time high of nearly 13% — I cannot even begin to understand or fathom why my colleagues across the aisle continue to reject measures that will bring new jobs and new opportunity to California.”

State officials have approved the Century Boulevard corridor that leads to and from Los Angeles International Airport as a new part of the “State Enterprise Zone” program. The City of Los Angeles’ bid to add the corridor to the program had stalled in Sacramento for almost a year. But recently appointed Deputy Mayor Austin Beutner stepped in to give it a push.