Arizona Direct Financial Incentives 2014
Arizona's economic development, finance and tax organizations provide a range of incentive programs to initiate new business and commercial investment.
Area Development Research Desk (Q1 2014)
Qualified Facility Tax Credit:
The goal of the Qualified Facility program is to encourage business investment that will produce high quality employment opportunities for citizens of Arizona and enhance Arizona’s position as a center for corporate headquarters, commercial research and manufacturing. The program accomplishes this goal by providing a refundable Arizona income tax credit to taxpayers who are expanding or locating a Qualified Facility in Arizona. The Program is administered by the Arizona Commerce Authority.
Computer Data Center Program:
The objective of the Computer Data Center (CDC) Program is to encourage CDC operation and expansion in Arizona. The Program accomplishes this objective by providing Transaction Privilege Tax (TPT) and Use Tax exemptions at the state, county and local levels for a period of up to 20 years, on qualifying purchases of CDC Equipment. The CDC Program is administered by the Arizona Commerce Authority in conjunction with the Arizona Department of Revenue.
Quality Jobs Tax Credit:
The primary goal of the Quality Jobs program is to encourage business investment and the creation of high-quality employment opportunities in the state. The program accomplishes this goal by providing tax credits to employers creating a minimum number of net new quality jobs and making a minimum capital investment in Arizona.The Quality Job program offers up to $9,000 of Arizona income or premium tax credits spread over a three-year period for each net new quality job.
General-purpose trade zones and sub-zones are strategically located around the state. Arizona is the only state offering federally approved FTZ companies a permanent property tax reduction of up to 73.7 percent.
Military reuse zones:
This special-purpose zone targets manufacturers, assemblers or fabricators of aviation or aerospace products and providers of aviation or aerospace services. Companies locating within these zones qualify for property tax reductions of up to 75 percent for five years, state income tax credits of up to $10,000 for each new qualified employee and certain exemptions from the transaction privilege (sales) tax.
Renewable Energy Tax Incentive Program:
The goal of the Renewable Energy Tax Incentive program is to encourage business investment that will produce high quality employment opportunities and enhance Arizona’s position as a center for production and use of renewable energy products. The program accomplishes this goal by providing tax incentives to companies in the solar, wind, geothermal and other renewable energy industries who are expanding or locating in Arizona. The program offers two benefits; up to a 10% refundable income tax credit and a reduction on real and personal property taxes of up to 73.7 percent.
Arizona Job Training Program:
The Arizona Job Training Program is a reimbursable grant program designed to meet the training needs of employers. The program may provide qualified employers cash assistance of up to $8,000 per employee for qualified, full-time employees in rural areas and up to $5,000 per employee in urban areas. Assistance, program rules, and details are available from the Arizona Commerce Authority, which administers the program.
Small Business Capital Investment Tax Credit Program (Angel Investment Program):
The main objective of the Angel Investment program is to expand early stage investments in targeted Arizona small businesses. The program accomplishes this goal by providing tax credits to investors who make capital investment in small businesses certified by the Arizona Commerce Authority. The Arizona income tax credit is up to 35 percent of the investment amount over a three-year period.
Research and development income tax credit:
The goal of the program is to encourage Arizona businesses to continue investing in research and development activities. The Research and Development program offers both refundable and non-refundable income tax credits for investments in R&D activities conducted in Arizona. The Arizona income tax credit starts at 24% of the qualified R&D expenses for amounts in excess of expenditures from the previous year. Recent legislation enhances the tax credit amount up to 34%, for some filers, if increased R&D expenditures are made in conjunction with an Arizona public university.
Healthy Forest Enterprise Incentives Program:
The primary goal of the Healthy Forest Enterprise Incentives Program is to promote forest health in Arizona. The program achieves this by providing incentives for certified businesses that are primarily engaged in harvesting, processing or transporting of qualifying forest products. Benefits include income tax credits, property tax reductions, fuel tax reductions and Transaction Privilege Tax (TPT) and Use Tax exemptions.
Arizona Innovation Accelerator Fund
$18.2 million loan participation program to stimulate financing to small businesses and manufacturers, in collaboration with private finance partners, to foster business expansion and job creation in Arizona.
AZ Fast Grant
Enables Arizona-based technology companies to initiate the commercialization process. Total funds available for this grant round are $175,000. Maximum awards of $5,000 and $20,000 will enable companies to accomplish one of four scopes of work.
AZ Step Grant
Grant funding from the U.S. Small Business Administration (SBA) with matching funds contributed by the Arizona Commerce Authority (ACA) offering a number of services and tools to Arizona small businesses as they go global for the first time with sales or enter new, international markets.
Commercial/Industrial Solar Tax Credit
Businesses installing a solar energy device at an Arizona facility may be eligible for an income tax credit of up to $50,000 per tax year.
Private Activity Bonds (PAB)
Tax exempt bond financing, for federal purposes, offers an alternative financing mechanism for certain projects.
Additional Depreciation Program:
Arizona tax laws provide an aggressive depreciation schedule to encourage new capital investment and reduce personal property tax liability.
Arizona State Contact:
Business Incentives Division
Arizona Commerce Authority
333 N. Central Ave. Suite 1900
Phoenix, AZ 85004
Incentive and tax information is provided to Area Development by each state's economic development or commerce agency for information purposes only and is subject to revision at any time by the state government. Please contact the state agency directly for full requirements and offerings.