California Has $240 Million Up For Grabs for Companies Expanding In and/or Relocating to California

The California Competes Tax Credit (CCTC) provides businesses that plan to expand in California or relocate to California with a potentially significant negotiated income tax credit. California’s Governor’s Office of Business and Economic Development (GO-Biz) has set aside over $243.3 million in CCTC funds for the current fiscal year that will run through June, 2017.

Does My Business Qualify?

Any business may qualify for the credit. CCTC awards are based on 11 factors that include the number of full-time jobs created in California, compensation (including benefits) paid to California employees, amount of new capital investment in California, the overall economic impact in California, and competition with other states for the project. There is no restriction based upon geography or industry.

How Does a Business Get an Award?

There are three application periods for the CCTC during each fiscal year and the multi-phased application period takes approximately three months from start to finish. The application periods for the current fiscal year are July 25, 2016 through August 22, 2016, January 2, 2017 through January 23, 2017, and March 6, 2017 through March 27, 2017. An application must be submitted within these periods and prior to the project commencement.

What is the Benefit?

The CCTC is a dollar-for-dollar offset to California income taxes and may offset alternative minimum tax. The credit is awarded over a five-year period and may be carried over for six years. Each credit award is unique to the company. Previous awards have ranged from $20,000 to $15 million. Small businesses with less than $2 million of gross receipts may be eligible for higher awards as a percentage of investment.

How Can Andersen Help?

Andersen has experience working with GO-Biz. We will use our insights to craft a competitive application. Andersen has successfully negotiated several CCTC awards and has helped companies navigate through the application process. We will work with GO-Biz on your behalf to position your proposal in a manner that aligns with the interests of the State of California.

Our highly skilled state and local tax team includes professionals with law, accounting, public sector and business management backgrounds. This complement of professionals will help align your business goals and tax benefits. We are not just a CCTC negotiator – we help taxpayers support, report and defend tax credits.

Let Andersen perform a complimentary review of your California business profile today to see if your business is a good candidate for the CCTC.