Connecticut Credits and Incentives

As we’ve mentioned before, our Georgia clients frequently ask us to investigate potential credits and incentives in other states where they have operations, potential acquisitions or strong relationships with customers or vendors. In addition, private equity groups ask us about potential $$ for their portfolio companies.
We were recently asked about credits and incentives in Connecticut, and their state economic development professionals gave us some details (CT DECD site click here).
Connecticut offers a collection of credits and incentives for new and existing businesses.  CNBC ranked Connecticut #34 in their 2015 America’s Top States for Business survey (Georgia was #5 in the same survey).    
Incentives and Credits include:
Tax Credits for Connecticut Business Investments — Enterprise Zones for qualifying (medium to larger) corporations, a Fixed Capital Investment 5% credit, Insurance Reinvestment Fund (large investments), Machinery and Equipment credits, Service and Manufacturing Facility credits, and Urban and Industrial Site credits.  Pre-approval required, of course, and caps apply.

Tax Credits for Creating Jobs and Developing a Connecticut Workforce — New Jobs Creation credits against payroll taxes, fairly decent. Qualified Small Business Job Creation credits, Human Capital Investment credits, and Job Expansion tax credits.

Other Tax Credits — Credits for Film, Television and Digital Media, Research and Development (similar to other states), and other special and assorted incentive programs.

Compared to Georgia, Connecticut has:
  • Much higher corporate and higher personal income tax rates.
  • Higher combined state and local tax burden
  • A narrower range of incentives.
  • Pre-approval required for all incentives
To summarize, Connecticut is below average for business tax incentives, but they do enjoy a prime Northeast location.

DaleSig