Federal Tax incentive Programs
Gulf Opportunity Zone
Louisiana's business incentive package is one of the most aggressive in U.S. history. Recently extended through 2010 for select parishes:
- 50% Bonus Depreciation and Net Operating Loss (NOL) carry back, allows businesses to leverageinvestments for refunds on past years taxes.
- Includes Calcasieu, Cameron, Orleans, Plaquemines, St. Bernard, St. Tammany and Washington parishes.
- Available through 2010 or until funds are depleted:
$7.9 billion in Gulf Opportunity Zone Bonds available for rebuilding.
Renewal Communities (RCs) are distressed areas in urban and rural communities that the federal government has targeted for development and where businesses are eligible for billions of dollars in tax incentives.
New Markets Tax Credits
Investors in qualified projects can obtain a tax credit of five or six percent of the amount invested for each year the investment is held, for up to seven years of the credit period. The program allows individual and corporate taxpayers to receive a credit against federal income taxes for making qualified equity investments in Community Development Entities (CDEs). The credits provide a taxpayer who invests in a qualified CDE a credit against income tax over a seven-year period. The credit is equal to five percent of the investment for the first three years and six percent of the investment for the final four years. Established by Congress in 2000, the New Markets Tax Credits program was greatly expanded by the Gulf Opportunity Zone Act of 2005, which provided amounts equal to $300 million for 2005 and 2006 and $400 million for 2007 among qualified CDEs within the Gulf Opportunity Zone.