Incentives Overview

Local Incentives –Applicable incentives vary based on project location and scope

 

Community Revitalization Enhancement District (CRED)

  • Credit against a taxpayer’s state and local tax liability for a qualified investment in that year
  • Amount of credit is the qualified investment multiplied by twenty-five percent (25%)
  • Special incentive packages may be based on recoupment of sales tax and/or state income tax amounts

 

Economic Development Revolving Loan Fund

  • Loans of up to $100,000 at rates as low as four percentage points below prime rate

 

Industrial Revenue Bonds

  • Low-interest tax-exempt bonds; Interests on the bonds is exempt from federal and state income tax

 

New Market Tax Credit (NMTC)

  • Taxpayers receive a Federal Tax Credit for making qualified equity investments
  • The credit totals 39% over a seven year credit allowance period
  • NMTC program may be layered with other federal tax benefits

 

Property Tax Abatement

  • Any property owner in an economic revitalization area who makes improvements to real property or installs new or used manufacturing equipment from out of state is eligible for property tax abatement
  • Commercial, industrial and equipment tax abatements are based upon project scope
  • Time frame varies and may be abated up to ten years

 

Tax Increment Financing (TIF)

  • TIF allows the city to use increased tax revenues stimulated by redevelopment or economic development to pay for the capital improvements, such as roads and utilities, within the boundary of the TIF district

 

Additional Incentives

Foreign Trade Zone

Companies that import or re-export can realize substantial time and financial savings via the Foreign Trade Zone (FTZ), a federal program designed to support American business and job growth.  In just a 30-minute conversation with your CFO or CEO, an FTZ consultant is able to gather the data required to produce a feasibility study/cost-benefit analysis, and it is free to you.  INzone (www.INzone.org or 317-487-7200), Central Indiana’s FTZ Grantee Administrator, pays for the study and helps connect you to qualified consultants.

 

In an FTZ, your company could experience these benefits:

  • Duty Savings – Imports may be admitted and held in an FTZ without paying U.S. Customs duties.
  • Flexibility – All merchandise, whether domestic or foreign, may be placed in an FTZ.  Within an FTZ users can mix, manipulate, test, clean, sample, salvage, process, display, repair, destroy, assemble, and manufacture merchandise and goods.
  • Zone-to-Zone Transfer – Items can be transferred between zones without being subjected to taxes.
  • Duty Rate Choice – FTZ users can pay the duty rate applicable to either the raw materials or the finished products manufactured from the raw materials, depending upon which is lower.
  • Shelf-Life – Items can be stored indefinitely in an FTZ, unlike a bonded warehouse.
  • Labeling – No country-of-origin labels are required on merchandise admitted to the FTZ.
  • Quota / Supply Chain Efficiency – Zone users can bring in bulk shipments and store quota goods in a FTZ until the next quota period allows for importation and distribution into the U.S.

 

State of Indiana

Indiana also offers many grants and incentives to qualified businesses.  More detailed information can be obtained from the Indiana Economic Development Corporation web site at http://iedc.in.gov/incentives.

Community Revitalization Enhancement District (CRED)

  • Credit against a taxpayer’s state and local tax liability for a qualified investment in that year
  • Amount of credit is the qualified investment multiplied by twenty-five percent (25%)
  • Special incentive packages may be based on recoupment of sales tax and/or state income tax amounts

Economic Development Revolving Loan Fund

  • Loans of up to $100,000 at rates as low as four percentage points below prime rate

Foreign Trade Zone

  • Imports may be admitted and held in a foreign-trade zone without paying U.S. Customs duties
  • FTZ users can pay the duty rate on component materials or merchandise produced from component material, whichever is lower
  • Customs duties are not paid on merchandise exported from a zone
  • Duties are reduced or eliminated on materials subject to defect, damage, obsolescence or scrap
  • Merchandise may be exported and returned to an FTZ without duty payment

Industrial Revenue Bonds

  • Low-interest tax-exempt bonds; Interests on the bonds is exempt from federal and state income tax

New Market Tax Credit (NMTC)

  • Taxpayers receive a Federal Tax Credit for making qualified equity investments
  • The credit totals 39% over a seven year credit allowance period
  • NMTC program may be layered with other federal tax benefits

Property Tax Abatement

  • Any property owner in a economic revitalization area who makes improvements to real property or installs new or used manufacturing equipment from out of state is eligible for property tax abatement
  • Commercial, industrial and equipment tax abatements are based upon project scope
  • Time frame varies and may be abated up to ten years

Tax Increment Financing (TIF)

  • TIF allows the city to use increased tax revenues stimulated by redevelopment or economic development to pay for the capital improvements, such as roads and utilities, within the boundary of the TIF district

State Incentives

The State of Indiana also offers many grants and incentives to qualified businesses. More detailed information can be obtained from the Indiana Economic Development Corporation web site at www.in.gov/iedc/grants.htm.