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California Unveils New Hiring Credit Targeting Small Business

With millions of Californians out of work, on Wednesday, September 9, Gov. Gavin Newsom signed a law giving tax breaks to small businesses that hire employees over the next three months.

The incentive program will offer businesses of 100 employees or less a tax credit of $1,000 on their state tax bills for each new employee hired by December 1, 2020. The credit only applies to businesses that have lost at least 50% of their revenue from April to June 2020, compared to the same time period in 2019. The credit is capped at $100 million statewide, or $100,000 for each business. Businesses get the credit only if they hire employees; not contractors. Furthermore, small businesses that are owned by large companies are not eligible for the credit.

California’s economy has been devastated by the Coronavirus pandemic as the Newsom administration ordered many businesses to close for months to slow the spread of the virus. California lost 2.4 million jobs in April; more than all the jobs lost during the Great Recession a decade ago. The state has added back nearly a third of those jobs since then, but the unemployment rate is still 13.3% — higher than it ever got during the Great Recession. As of Tuesday, the state lists 33 of the state’s 58 counties as the most at risk for the Coronavirus, a designation that requires many businesses to halt indoor operations.

California Film and Television Tax Credit Program — Sales and Use Tax Liability

Significant changes have been made to the California Film and Television Tax Credit Program, which allows qualified taxpayers a tax credit against income and/or sales and use tax liabilities based on expenditures for film and television shows produced in California. Under A1839, not only has a new ranking system replaced the current lottery system as well as an expansion of eligibility to big budget feature films; and a funding increase from $100M to $300M per fiscal year; but also a New Film and TV Tax Credit Program has been established effective January 1, 2016. Continue reading “California Film and Television Tax Credit Program — Sales and Use Tax Liability”

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California Competes Tax Credit Application Period Open

Applications are now being accepted for the California Competes Tax Credit. The California Competes Tax Credit provides an income or franchise tax credit to businesses that relocate to California or expand within California. The proposed business venture, investment, or expansion in California is the basis for award of the California Competes Tax Credit. Applications are reviewed by the Governor’s Office of Business and Economic Development (GO-Biz) and will be accepted through April 6, 2015. The application period is the last of three for fiscal year 2014-2015.

California Competes Releases Final Regulations

Effective February 5, 2015, final regulations to implement the California Competes Tax Credits (CCTC) program were adopted. These final regulations are substantially similar to regulations adopted as emergency regulations on November 17, 2014. CCTC is administered by the Governor’s Office of Business and Economic Development (GO-Biz), is a credit against the personal income and the corporation franchise (income) tax for businesses locating or expanding in California, based on an amount negotiated between Go-Biz and the taxpayer (as approved by the CCTC Committee).

Applications Now Being Received for California Competes Tax Credit

The California Competes Tax Credit (CCTC) is an income tax credit that is available to companies for a project associated with staying or growing in California. The tentative amount of credits allocated to Go-Biz are $30M for FY 2013-14, $150M for FY 2014-15 and $200M for each FY 2015-16 and 2017-18. Small businesses with gross receipts of less than $2M during the previous taxable year have been specifically allocated to receive 25% of the total credits available each year.

Continue reading “Applications Now Being Received for California Competes Tax Credit”

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