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TAX CREDITS

Code

Employer’s Credit for Basic Skills Education. Businesses which provide or sponsor basic skills education that enhances reading,

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writing, or mathematical skills up to and including the 12th grade, or classes to receive a GED certificate, may receive a tax credit.

The program is administered by the Department of Technical and Adult Education. This credit should be claimed on Form IT-BE. For

more information, refer to O.C.G.A. §48-7-41.

The retraining tax credit allows employers to claim certain costs of retraining

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Employer’s Credit for Approved Employee Retraining.

employees to use new equipment, new technology, or new operating systems. For tax years beginning on or after January 1, 2009,

approved retraining shall not include any retraining on commercially, mass produced software packages for word processing, data

base management, presentations, spreadsheets, e-mail, personal information management, or computer operating systems except

a retraining tax credit shall be allowable for those providing support or training on such software. The credit is calculated at 50% of

the direct costs of retraining full-time employees, up to $500 per employee per approved retraining program per year. For tax years

beginning on or after January 1, 2009, there is a cap of $1,250 per year per full-time employee who has successfully completed

more than one approved retraining program. The credit may be utilized up to 50% of the taxpayer’s total state income tax liability for a

tax year. For tax years beginning on or after January 1, 2009, the credit must be claimed within 1 year instead of the normal 3 year

statute of limitation period. Credits claimed but not used may be carried forward for 10 years. For a copy of the Retraining Tax Credit

Procedures Guide, contact the Department of Technical and Adult Education at 404-253-2800 or visit their website. This credit should

be claimed on Form IT-RC, with Program Completion forms signed by Department of Technical and Adult Education personnel

attached. For more information, refer to O.C.G.A. §48-7-40.5.

Employer’s Jobs Tax Credit. Employer’s Jobs Tax Credit. This credit provides for a statewide job tax credit for any business or

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headquarters of any such business engaged in manufacturing, warehousing and distribution, processing, telecommunications,

broadcasting, tourism, or research and development industries, but does not include retail businesses. If other requirements are

met, job tax credits are available to businesses of any nature, including retail businesses, in counties recognized and designated as

the 40 least developed counties.

Tier Designation

County Rankings

New Jobs Created

Credit Amount

Tier 1

1 through 71

5 or more*

$ 3,500

Tier 2

72 through 106

10 or more

$ 2,500

Tier 3

107 through 141

15 or more

$ 1,250

Tier 4

142 through 159

25 or more

$ 750

Credits similar to the credits available in Tier 1 counties are potentially available to companies in certain less developed census tracts

in the metropolitan areas of the state. Note that average wages for the new jobs must be above the ave- rage wage of the county that

has the lowest average wage of any county in the state. Also employers must make health insurance available to employees filling the

new full-time jobs. Employers are not, however, required to pay all or part of the cost of such insurance unless this benefit is provided

to existing employees. For taxpayers that initially claimed this credit for any taxable year beginning before January 1, 2009, credits are

allowed for new fulltime employee jobs for five years in years two through six after the creation of the jobs. In Tier 1 and Tier 2 counties,

the total credit amount may offset up to 100% of a taxpayer’s state income tax liability for a taxable year. In Tier 3 and Tier 4 counties, the

total credit amount may offset up to 50% of a taxpayer’s state income tax liability for a taxable year. In Tier 1 counties and less

developed census tracts only, credits may also be taken against a company’s income tax withholding. To claim the credit against

withholding, a business must file Form IT-WH at least 30 days prior to filing the return on which the applicable jobs are claimed or 30

days prior to the due date of the return if earlier. Once the income tax return is filed, the Department has

120 days to review the withholding credit being claimed and notify the business of the approved credit and when and how it may be

claimed. A credit claimed but not used in any taxable year may be carried forward for 10 years from the close of the taxable year in

which the qualified jobs were established. The measurement of new full-time jobs and maintained jobs is based on average monthly

employment. Georgia counties are re-ranked annually based on updated statistics. This credit should be claimed on Form IT-CA. An

additional $500 per job is allowed for a business locating within a county that belongs to a Joint Development Authority per O.C.G.A.

§36-62-5.1.

An existing business enterprise as defined in O.C.G.A. §48-7-40 qualifies for an additional $500 credit for each new

fulltime job provided all conditions are met. For taxpayers that create a new year one under DCA regulations for any taxable year

beginning on or after January

1, 2009 the following changes apply:

1. The definition of a business enterprise now also includes a business or headquarters of a business that provides services for

the elderly and persons with disabilities (only for the jobs credit provided pursuant to O.C.G.A. 48-7-40).

2. The credit may be claimed beginning with the year the job is created as opposed to the year after the job is created.

3. The credit may be claimed against withholding tax for a business enterprise engaged in a competitive project

(as certified by the Department of Economic Development) which is located in a tier 2, 3, or 4 county.

4. The additional $500.00 tax credit for an existing business enterprise is allowed to be claimed in the year the job is created as opposed

to the year after the job is created.

5. The additional new full-time jobs created in the 4 years after the initial year shall be eligible for the credit.

6. The credit must be claimed within 1 year instead of the normal 3 year statute of limitation period.

* For a business enterprise that creates a new year one under DCA regulations for any taxable year beginning on or after January 1, 2012,

in tier 1 counties, the business enterprise must increase employment by 2 or more new full-time jobs for the taxable year to be eligible for

the credit. See the Job Tax Credit law (O.C.G.A. 48-7-40 and 48-7-40.1) and regulations for further information or refer to the Department

of Community Affairs website.

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Form It 611s Instructions - S Corporation Income Tax - Georgia Department Of Revenue - 2014 Page 12

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