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The majority of counties in Tier 1 are in middle and south Georgia.

The state job tax credit designations for the four counties served by the Northwest Georgia Joint Development Authority did not change in 2020.

The Georgia Department of Community Affairs, or DCA, announced its 2020 designations for individual counties. Designations fall within four tiers. Counties in Tier 1 are considered the most economically disadvantaged, receive the highest credit and have the lowest job creation minimum to be eligible for the program, while Tier 4 counties fall at the opposite end of the spectrum.

Dade, Catoosa, Chattooga and Walker counties designations remain the same in 2020 as in 2019, with Dade and Catoosa in Tier 3, Walker in Tier 2 and Chattooga in Tier 1. Because these counties are members of a joint development authority, or JDA, an additional $500 job tax credit is available per job when the minimum requirements are met.

“This ($500 JDA bonus credit) in conjunction with the state’s job tax credit program increases the community’s competitive advantage and saves money on a company’s state income tax liability,” said Melissa Skinner, marketing specialist at the Northwest Georgia JDA.

{div}Skinner named some businesses that have benefited from using the JDA’s credit.

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{div}Catoosa County’s Shaw LVT Plant in Ringgold used the program when it announced 200 new jobs. Multiplying 200 jobs by $500 each for the JDA credit each results over five years results in the business saving $500,000 total in job tax credits, he said.

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{div}Audia Plastics in LaFayette created 140 jobs; when those jobs are multiplied by $500 per job for five years, the business saves $350,000 in job tax credits, he said.

New or expanding businesses in Dade and Catoosa counties must create at least 15 net new jobs that meet the requirement of defined business enterprises as listed by DCA to be eligible for a $1,250 credit per net new job, or $1,750 per job with the JDA bonus; the tax credits may be used against 50% of the business’ income tax liability.

New or expanding businesses in Walker County must create at least 10 net new jobs that meet the requirement of defined business enterprises as listed by DCA to be eligible for a $2,500 credit per net new job, or $3,000 per job with the JDA bonus; the tax credits may be used against 100% of the business’ income tax liability.

New or expanding businesses in Chattooga County must create at least two net new jobs that meet the requirement of defined business enterprises as listed by DCA to be eligible for a $3,500 credit per net new job, or $4,000 per job with the JDA bonus; the tax credits may be used against 100% of the business’ income tax liability and withholding.

According to DCA:

♦ Only 20 Georgia counties do not participate in a multi-county joint development authority.

♦ The required number of net new jobs must be created within a single tax year, and the new jobs must be a newly-created positions not previously located in this state.

♦ The employee must work a minimum of 35 hours each week to be considered full time for the credit.

♦ The new jobs must be offered health insurance upon employment; the employer does not have to pay for such insurance, just offer it.

♦ The average wage of each new job created must pay at or above the average wage of the county with the lowest average wage in the state. Check with DCA for the current average waged used for the threshold.

♦ The job creation requirement must be met within a single tax year, and the tax credit may first be claimed on the initial year tax return. For example, eligible net new jobs created in 2019 may claim the credit on the 2019 tax return. If these jobs are then maintained for the next four years, then the business may claim the tax credit on each of those years’ tax returns, too.

♦ The credit is claimed by filing Form IT-CA with the Georgia corporation income tax return.

♦ The credit may be filed on an amended tax return within one year of the original, timely-filed, tax return.

♦ The business has 10 years from the year the new jobs are created to utilize the tax credit.

♦ There is no application process. The business must meet the program eligibility requirements and create eligible net new jobs to Georgia. However, if located within an opportunity zone, then the opportunity zone certification form must be completed and accepted prior to claiming the tax credit.

♦ Check with DCA for information related to designated opportunity zones, less developed census tracts and military zones.

Catherine Edgemon is assistant editor for the Walker County Messenger in LaFayette, Ga., and the Catoosa County News in Ringgold, Ga.

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