July 30, 2018 | CIG Tax Insights
As a follow up to our article last month, today marks the opening day for the recently extended [and modified] California Competes Tax Credit (CCTC) program. With $70 million available, the state is seeking to award worthy businesses seeking to grow jobs and investments in California. This $70 million application period closes on August 20th, with the funds being officially awarded in Sacramento on November 13th.
Enacted in 2013, the CCTC is an income tax credit administered by the Governor’s Office of Business and Economic Development (GO-Biz). Since 2014, GO-Biz has negotiated and granted $759 million in CCTC awards to 957 California businesses.
CIG INSIGHTS: For calendar year taxpayers, please note that this is the final application period where your 2017 tax year is your CCTC “base year” (i.e. an Applicant’s 12/31/17 employee headcount is used as its starting point for purposes of measuring incremental job growth). In subsequent CCTC application periods, your base year will be your 2018 tax year.
Moreover, unlike prior application periods, the program no longer allocates a portion of the available funds to businesses with less than $2 million in annual gross receipts, or “small businesses”. This leaves more award funds available for larger businesses.
CIG EXPERTISE: Led by Alex Tran, our team of CCTC experts have represented more than 40 businesses to over $35 million in CCTC awards. With awards ranging from $90,000 to $8 million, these funds have helped businesses in manufacturing, tech, R&D, apparel, engineering, life-sciences, software, green energy, food, e-commerce and many others.
Combining our deep CCTC technical knowledge, experience and state income tax backgrounds—we believe we have a one-of-a-kind approach to helping our clients grow California jobs and investments through the California Competes Tax Credit.
WE’RE HERE TO HELP: If you’re interested in learning more about how we can help your business earn a CCTC award, please reach out to us for a complimentary assessment.