Georgia Job Tax Credit
The Georgia Job Tax Credit program provides a tax credit to certain eligible businesses that create net new jobs in the state. Counties in Georgia are ranked into tiers using three factors: unemployment rate, per capita income and percentage of residents whose incomes are below the poverty level and the job credits are determined by county tier and meeting minimum new jobs thresholds.
Businesses (or their headquarters) must be engaged in manufacturing, warehousing and distribution, processing, telecommunications, broadcasting, tourism, or research and development industries.
If businesses are located in counties recognized and designated as the 40 least developed counties, in Military Zones or in Opportunity Zones, they may be engaged in any industry (including retail).
Qualified employees must be:
- Full-time (employed for a minimum of 35 hours per week);
- Have an average wage at or above the average wage of the county that has the lowest average wage of any county in the state;
- Have health insurance made available to them.
The Georgia Job Tax Credit amount is determined by county rank or specially designated areas such as less developed census tracts (“LDCT”), Military Zones (“MZ”) or Opportunity Zones (“OZ”) and the number of net new jobs created.
|Tier||County Rankings||Minimum New Jobs Creation||Credit Amount Per Eligible New Job||Use of Credits|
|1||1 through 71||2||$3,500||100% of tax liability - excess can be applied against withholding tax up to $3,500|
|2||72 through 106||10||$2,500||100% of tax liability|
|3||107 through 141||15||$1,250||50% of tax liability|
|4||142 through 159||25||$750||50% of tax liability|
|MZ/OZ||N/A||2||$3,500||100% of tax liability - excess can be applied against withholding tax|
|LDCT||N/A||5||$3,500||100% of tax liability - excess can be applied against withholding tax|
The Georgia Job Tax Credit is a five year credit program. Credits may be taken on jobs created in years one through five as long as those jobs are maintained:
- A business in a Military Zone creates 10 new jobs – 10 jobs x $3,500 = $35,000 x 5 years = $175,000
For businesses located in Tier 1 counties, Military Zones, Opportunity Zones and/or Less Developed Census Tracts, credits can be applied against 100% of the business’s Georgia corporate income tax liability.
Businesses located in Tier 1 counties, Military Zones and Opportunity Zones may elect to utilize any excess credits against its withholding tax by filing Form IT-WH at least 30 days before filing the original tax return.
Businesses located in counties participating in a joint development authority are eligible for a $500 bonus credit per net new job.
Unused credits may be carried forward for up to 10 years.
The Job Tax Credit and the Investment Tax Credit cannot be taken on the same project.
The Job Tax Credit and the Quality Jobs Tax Credit cannot be taken on the same jobs.
Taxpayers may go back one year to claim the job tax credit retroactively.
Estimated benefit for companies participating in the job tax credit:
If an eligible business creates 25 net new jobs under the job tax credit program and maintains those jobs for five years, the business could generate a five year credit total of up to $500,000 depending on the location of the business:
|County Tier Ranking||Credit Amount Per Net New Job*||Annual Number of Net New Jobs||5 Year Credit Potential|
*Credit amounts for Tiers 1-4 include the $500 Joint Development Authority (JDA) bonus since all counties in GA except one are in JDAs.
Information needed to calculate the credit:
- Business NAICS code
- List of locations
- Detailed payroll information for the current and prior tax years including:
- Location ID
- Employee Name
- Employee Address (street address, city, state and zip)
- Hire Date
- Termination Date
- Re-hire Date (if applicable)
- Gross annual wages
- Total hours worked