Economic Development and Housing

Enterprise Zone Program

Economic Development and Housing Division
City of Clearwater Enterprise Zone #5202

What is an Enterprise Zone?
An Enterprise Zone, designated by the state of Florida, is a geographical area targeted for economic revitalization. This program provides State to businesses and property owners to encourage the retention and expansion of business investment in the zone as well as employment opportunities for the area’s residents.

The Florida Enterprise Zone Program is authorized in sections 290.001 through 290.0016 Florida Statutes, and is authorized until December 31, 2015.

The City of Clearwater Enterprise Zone offers six different incentives available under this program.

Financial Incentives

• Enterprise Zone Jobs Tax Credit (Corporate Income Tax)
• Enterprise Zone Jobs Tax Credit (Sales and Use Tax)
• Enterprise Zone Property Tax Credit (Corporate Income Tax)
• Sales tax refund for building materials used in rehabilitation of real property
• Sales tax refund for business machinery and equipment
• Community Contribution Tax Credit Program

Eligible Businesses
Tax incentives are offered to all types of businesses that are located within a designated Enterprise Zone who employ zone residents, rehabilitate real property or purchase business equipment/machinery to be used in the zone. Tax credits are available to businesses that pay either the Florida Corporate Income Tax or the Florida Sales and Use. Tax. Sales tax refunds are available if eligible purchases are made.

Enterprise Zone Development Agency Contact
Each enterprise zone has a local person who is responsible for the administration of that zone. This person can provide the location and map of the designated area and all the necessary incentive forms. Contact Diane Hufford, Phone #727-562-4054, Fax #727-562-4075 or e-mail diane.hufford@myclearwater.com.

View Enterprise Zone Map for Clearwater (PDF file)

For Other Useful Information Regarding Enterprise Zones:

• Enterprise Florida (eZones)
• Florida Department of Revenue

Jobs Tax Credit (State Sales & Use Tax)
Form DR-15ZC (N. 01/02)
(Florida Enterprise Zone Jobs Credit Certificate of Eligibility for Sales Tax)
(s. 212.096,F.S.)

Business Eligibility

• Must be located within an Enterprise Zone
• Must collect and remit sales and use tax
• Must not be taking E.Z. Jobs Tax Credit against corporate income tax

Employee Eligibility

• Must resident and work in an Enterprise Zone
• A new job must be created before the business earns a tax credit
• Welfare Transition Program Participants may live anywhere, but must work within a zone
• Must work an average of at least 36 hours a week (no part-time employees)
• Must be employed for at least three consecutive months
• New employee cannot be an Owner, Partner, or Stockholder.
• Employees leased from an employee leasing company (Chapter 468) must be continuously leased to an employer for more than 6 months
• Previous employees must not have been employed by the hiring business in the preceding 12 months
• Tax credit shall be allowed for up to 24 months per new employee
• Tax credit amount cannot be more than amount of sales tax owed

Number of permanent, full-time employees (Zone Residents)
Divided by
Total number of permanent, full-time employees

If this percentage is less than 20% the tax credit will be 20% of monthly wages paid to new employee.
If this percentage is 20% or more the tax credit will be 30% of monthly wages paid to new employee.

Jobs Tax Credit (State Corporate Income Tax)
Form F-1156Z (Certificate of Eligibility for Corporate Income Tax)
Form F-1156ZN (General Information)
(s.220.181,F.S.)

Business Eligibility

• Corporation must be located within an Enterprise Zone
• Business must not be taking Jobs Tax Credits against sales tax

Employee Eligibility

• Must resident and work in an Enterprise Zone
• A new job must be created before the business earns a tax credit
• Welfare Transition Program Participants may live anywhere, but must work within a zone
• Must work an average of at least 36 hours a week (no part-time employees)
• Must be employed for at least three consecutive months
• New employee cannot be an Owner, Partner, or Stockholder.
• Employees leased from an employee leasing company (Chapter 468) must be continuously leased to an employer for more than 6 months
• Previous employees must not have been employed by the hiring business in the preceding twelve months
• Tax credit shall be allowed for up to 24 months per new employee
• Unused tax credit may be carried forward up to 5 years

Number of permanent, full-time employees (Zone Residents)
Divided by
Total number of permanent, full-time employees

If this percentage is less than 20% the tax credit will be 20% of monthly wages paid to new employee.
If this percentage is 20% or more the tax credit will be 30% of monthly wages paid to new employee.

Business Equipment Sales Tax Refund
Form EZ-E (Business Equipment Sales Tax Refund Application for Eligibility)
Form DR-26S (Florida Department of Revenue Application for Refund)
(s.212.08(5)(h),F.S.)

Business Eligibility

• Must be located in an Enterprise Zone
• Business Equipment purchased must have a sales price of at least $5,000 per unit
• Equipment purchased must be used exclusively in an Enterprise Zone for at least 3 years
• Eligible purchase must be new or used property defined as “recovery property” in s.168c of the Internal Revenue Code of 1954 as amended, NOT including the following:
  • 3-year property under s.168c2A of Internal Revenue Code
  • industrial machinery/equipment (receiving a capital equipment sales tax exemption under s.212.08 5b, F.S
  • building materials material eligible for E.Z. sales tax refund incentive
• There is no limit on the number of applications that can be filed
• All required forms must be filed with the Department of Revenue within six months after the equipment is purchased or the tax due.

Refund Calculation

• 97% of the state sales tax (6%) paid on Business Equipment
• If less than 20% of permanent, full-time employees are residents of an Enterprise Zone, the maximum refund per application will be no more than $5,000 or 97%
  of the sales tax paid
• If 20% or more of permanent, full-time employees are residents of an Enterprise Zone, the maximum refund per application will be no more than $10,000 or 97% of the sales tax paid

Business Materials Sales Tax Refund
Form EZ-M (Business Materials Sales Tax Refund Application for Eligibility)
Form DR-26S (Florida Department of Revenue Application for Refund)
(212.08(5)(g,F.S.)

Eligibility

• Property being renovated must be located in an Enterprise Zone
• Business and Residents are eligible for sales tax refund
• Sales Tax Refund is available only one time per parcel of real estate
• Incentive limited to owners, lessors, and lessees of the real property this is rehabilitated
• Forms must be filed with the Department of Revenue within six months after the improvements are certified by the building inspector as being substantially complete

Refund Calculation
97% of the state sales tax (6%) paid on Building Materials

Example:
$8,600 building materials purchased)
x .06 (state sales tax)
= $516.00
x .97
= $500.52 (amount of sales tax refund)

The total amount of state sales tax refund must be at least $500.
If less than 20% of the business permanent full-time employees are residents of an Enterprise Zone, the maximum refund per application will be no more than $5,000 or 97% of the sales tax paid.
If 20% or more of the permanent, full-time employees are residents of an Enterprise Zone, the maximum refund per application will be no more than $10,000 or 97% of the sales tax paid.

Property Tax Credit
Form F-1158Z (Enterprise Zone Property Tax Credit)
Form DR-456 (Notice of New, Rebuilt, or Expanded Property)
(s.220.182, F.S.)

Business Eligibility

• Corporation must be located within an Enterprise Zone
• Firms must earn more than $5,000 to take advantage of the credit
• New Business must establish 5 or more new jobs
• Expanding Businesses must establish 5 or more new jobs

Tax Credit Calculation

• New businesses tax credit will be based on the amount of ad valorem taxes paid
• Expanding businesses tax credit will be based on the additional ad valorem taxes paid from the assessments on additional real or tangible personal property acquired for the expansion project
• Rebuilding businesses tax credit will be based on the ad valorem taxes paid from the assessments on property replaced or restored
• If 20% or more of the full-time employees are enterprise zone residents then the maximum of $50,000 annual credit can be claimed for 5 years; otherwise the credit is limited to $25,000 annually for five years
• Any unused portion of the credit can be carried forward to 5 years

Community Contributions Tax Credit
Corporate Income Tax or Sales Tax Refund
Section 220.183, Florida Statues
Section 212.05(5)(q), F.S

The Community Contribution Tax Credit Program provides a financial incentive (50% tax credit) to encourage Florida businesses to make donations toward community development and housing projects for low-income persons.

The tax credit is easy for a business to receive. Businesses located anywhere in Florida that make donations to approved community development projects may receive a tax credit equal 50 percent of the value of the donation. Business may take the credit on Florida corporate income tax, insurance premium tax or as a refund against sales tax (for businesses registered to collect and remit sales taxes with the Department of Revenue).

Before making a donation, please be sure it will qualify. A list of eligible organizations is available from the Office of Tourism, Trade and Economic Development (OTTED). To receive approval, a business donating to an eligible sponsor need only file a request form with OTTED. In order to claim the tax credit, simply attach proof of the approved donation when you file your state tax return.

To become a sponsor, your organization must submit a proposal to the Office of Tourism, Trade and Economic Development with the following information:

• A copy of your organization’s articles of incorporation, by-laws, or other documentation establishing eligibility as a sponsor.
• A project narrative describing the eligible activity and listing the type(s) of contributions to be sought and their intended use.
• Documentation that the project is located in an Enterprise Zone
• A resolution from the local government (where is project is located) stating that the project is consistent with local plans and regulations (including comprehensive plans)

Once your agency has received written approval from OTTED, you may begin accepting eligible contributions. Project approval expires on June 30 of each year. A sponsor must be recertified for each subsequent year to continue to be eligible to accept contributions.