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Overview
Business Tax Incentive Zones have been created and offered to local businesses by local, state and federal government institutions to entice new development or expansion into specific geographic areas in the U.S. There are thousands of these zones individually managed and funded throughout the U.S. To assist its clients with determining whether they qualify for these lucrative incentives, BITI has developed the most comprehensive database of Tax Incentive zones available. This database includes tax incentives which are geographically derived. The database has been developed over the past five years by establishing contacts with government institutions and collecting their data for geographic processing by BITI‘s mapping service operation. BITI converts the data from the submitted input format into a digital format that can be queried by software applications or be mapped for visual presentation. Because the data is continually changing, BITI updates and refreshes the database monthly to maintain its currency and accuracy.
BITI’s complete national database contains contact names and telephone numbers of local, state and federal tax incentive zone managers for the purpose of obtaining the necessary documentation to apply for tax incentive credits in addition to its geographic attributes. The database also includes multiple zone qualification information for an address which may qualify for multiple incentives.
BITI’s geographic approach enhances the ability for a client to determine whether a specific address is located within the boundaries of a tax incentive zone, what type of zone it is, who to call for reporting documentation, and the phone number to call. The database vastly improves the accuracy of the investigation, the response time required to determine whether and addresses qualifies, and reduces the cost of determining whether an address qualifies for a tax incentive or not. Many person hours are wasted only to find out that an address does not qualify. Worse yet, not knowing whether and address qualifies may result in unrealized profits for the company. Using appropriate software, like BITI’s MarketPro application or its ZIP+4 Geocoder, the client can perform either single address lookup or process thousands of addresses during a single data run.
Knowing if your business location or your employees reside in a qualified tax incentive zone can mean thousands of dollars in tax savings or other lucrative benefits. For example, in California, firms can apply for back tax credits in the Los Angeles Revitalization Zone (LARZ) and realize up to $21,000 in state tax credit per qualified employee hired; or in California’s Enterprise Zones earn up to $29,234 state tax credit per qualified employee hired. In Utah, businesses located in qualified Recycling Market Development Zones that use, collect, process or distribute recycled materials receive financing assistance, competitive utility rates, reduced business license fees, state tax credits on machinery and eligible operating expenses and more.
There are many different types of eligible tax incentive zones in BITI’s database. There are Federal Empowerment Zones and Enterprise Communities (EZEC), Manufacturing Enhancement Areas (MEA Zones ), Targeted Tax Areas (TTAs), Local Agency Military Base Recovery Act (LAMBRA), Indian Reservations, and many more.
It’s important to know where your business and employees are located to reap the tax incentive benefits available to you!Detailed Information
The tax incentive database provides the user with the following information:
- Zone name
- Zone type (Federal - urban/rural or state/local)
- Zone contact manager
- Zone contact phone number
- Status of the zone (designated, partial, or potential); designated indicates that the BG in which the address resides is completely in the zone; partial indicates that the BG in which the address resides is partially in the zone and will require further investigation or a call to the zone manager; potential indicates that the BG has been selected to be in a zone, but will be dependant on the user to make application. (NOTE: see Future Plans and Consideration Section below. The status field is being eliminated)
- Census Block Group ID
- Date last updated
The database includes tax incentive data for up to 5 separate tax zones per block group.
Data Collection & Maintenance
BITI has contacts with local, state, and national agencies that manage the tax incentive assignments. These contacts are contacted for updates at least twice per year.
The federal zones are well documented and updated approximately every 6 months. Two categories of zones and communities are included in the federal definition; urban and rural. These zones/communities are also categorized by the when they were enacted by Congress (Round 1, Round 2, Round 3).
The state zones and communities are managed by various departments in the state governments. A database of contacts responsible for tax incentives has been developed and is maintained on a regular basis. The geographic definition of the zones and communities vary from state to state. The definitions of the zones are stated in terms of census tracts, counties or communities. Each state has been contacted and the geographic definitions collected for their state zone and community data.
The data collected includes:
- contact information;
- geographic description of the zone or community;
- federal or state status;
- official program name of zone or community;
The geographic data collected is processed and census block group ID matched with BITI’s block group database. This permits an assignment to be made interactively by simply entering an address or submitting several addresses in batch mode. In the event that a zone or boundary bisects a block group, a flag in the database will be set to alert the user that the input address is in a geographic area that is split by the zone or community. Further investigation may be required to determine whether the address is in the zone on not.
A unique ID is assigned to each zone which is cross-referenced within our database for contact information about the zone. Each zone and community carries a federal or state designation which is provided to the user at the time of assignment.
The Tax Incentive database is maintained on a semi-annual basis for each state. If more frequent updates are required, BITI adjusts the update cycle. To view the most current Tax Incentive Update Workbook, click here.Future Plans & Considerations
BITI’s current Tax Incentive data files are census block group based. For the federal files, this works fine because this data is compiled by the government at the census level. However, many state and local zones are not census boundary based. Consequently when an analysis is performed, each record will be assigned an status indicator (Designated or Partial). The status indicator indicates where the address is in a zone (Designated) or is in a census block group that is partially in a zone (the tax zone is not completely in the block group).
To address this, BITI is in the process of digitizing all local, state and federal zones to their exact boundaries. This process will produce the exact digital boundary of all Tax Incentive zones in the BITI database and eliminate the Designated or Partial status. The input address will either be in or out of the zone.
We have state list priority that we are working and expect by mid year to have the entire US completed. Currently CA, IN, and IL are digitized.