Tax credit incentive issued

Feb. 07, 2013 @ 05:11 PM

An Urban Progress Zone Tax Credit Designation was recently issued to the City of Henderson, offering Article 3J tax credits to eligible businesses.

Aimed at boosting recruitment of industry and aiding job growth, Article 3J tax credits provide three types of incentives to taxpayers, including credit for creating jobs, credit for investing in business properties and credit for investment in real property.

“If you are a 3J tax credit company, and you locate in an Urban Progress Zone, you get an additional $1,000 per employee for the next five years,” said Stuart Litvin, director of the Henderson-Vance Economic Development Commission. “If you then hire someone who lives in the Urban Progress Zone, then that’s an additional $2,000 per job, per year.”

Overall, for a business locating in an economically distressed Urban Progress Zone, which hires from within the community, credits could be combined to offset 50 percent of the taxpayer’s state income and franchise tax liability.

According to Erris Dunston, planning and community development director for the City of Henderson, primary activity of business establishments must be specific.

Primary activity of these business establishments includes aircraft maintenance and repair, air courier services hub, company headquarters, customer service call centers, electronic shopping and mail order houses, information technology services, manufacturing, motor sports facilities, motor sports racing teams, research and development, warehousing and wholesale trade.

Companies must also meet a minimum threshold of new full-time jobs created during the taxable year to be eligible for tax credit.

“It depends on the type of company it is,” Dunston said. “If it’s a headquarters it would have to have at least 75 headquarter jobs.

“Counties with Tier One designation, the company would have to have at least five employees.”

The Urban Progress Zone Tax Credit Designation was designed for a wide variety of businesses, both small and large.

“You can have something as small as, information technology related, or something like research and development that may not have that many people,” Dunston said. “I think it depends on being able to fit a business into these categories.”

Dunston is currently the zone contact for Henderson, responsible for answering questions about zone boundaries from businesses interested in the Urban Progress Zone tax credits, and can be reached at the Henderson Office of City Manager.

Urban Progress Zone tax credit enhancements are described on the Department of Commerce website at with information about the 3J program. 

The city of Henderson will be designated as an Urban Progress Zone through Dec. 31, 2014.

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