Follow Me

State Incentives

State Economic Development Incentives

State Economic Development Grants must be applied for and are subject to the annual appropriation of such funds by the State of Colorado and the availability of such funds for this project.  Salaries must meet or exceed Pueblo County Average Annual Salary.

PEZ

The Pueblo Urban Enterprise Zone is part of the State of Colorado’s Enterprise Zone program under the Colorado Urban and Rural Enterprise Zone Act.

  • The New Business Facility Employee Credit: Any company that establishes a new business facility located in an enterprise zone can claim an income tax credit of $500 for each employee working within the zone. A new business facility is a newly acquired, constructed or leased facility used by the taxpayer to operate a revenue-producing enterprise.  For subsequent tax years, a credit of $500 shall be allowed for any increase in the average number of employees working in the zone in excess of the maximum number employed in any prior tax year.
  • The New Business Facility Agricultural Processing Employee Credit: An additional credit of $500 per new business facility employee may be claimed by businesses that add value through manufacturing or processing of agricultural commodities.
  • The Employer Sponsored Health Insurance Credit:For the first full two year period while located in an enterprise zone, a taxpayer can take a credit of $200 for each new employee insured under a health insurance plan or program that is approved by the State Insurance Commissioner and at least 50% of the cost paid by the taxpayer.
  • Research and Development Tax Credit:Companies that make expenditures on research and experimental activities in the Enterprise Zone qualify for a three percent (3%) income tax credit. The tax calculated as three percent (3%) of the amount of increase in the research & development expenditures within an enterprise zone over the average of such expenditures during the previous two years. The expenditures must meet the research and experimental activities as defined in section 174 of the federal Internal Revenue Code of 1986, as amended.
  • Twenty Five Percent (25%) Tax Credit to Rehabilitate Vacant Buildings up to $50,000:This tax credit is intended to encourage building owners to undertake rehabilitation projects and bring buildings back into use. A building in an enterprise zone that is at least 20 years old and has been completely vacant for at least two years qualifies for this tax credit to claim credit.  A taxpayer must submit DR 0076 to the Enterprise Zone administrator.
  • Qualified Job Training Program Investment Credit:For income tax years, beginning on or after January 1, 1997, Colorado taxpayers are allowed to claim a credit of ten percent (10%) of their total current year investment in a qualified job training program. “Qualified job training program” means a structured training or basic education program conducted on-site or off-site by the taxpayer or another entity to improve the job skills of the company's employees and must meet current state requirements.
  • Enterprise zone investment tax credit:The enterprise zone investment tax credit is 3% of any qualified investment in section 38 property: (1) acquired and placed in service or constructed during the tax year, and (2) used exclusively (100%) in a Colorado enterprise zone for the first year of its ownership. This enterprise zone investment tax credit is in lieu of any “old investment tax credit” that otherwise would be allowed.

Colorado & Pueblo Tax Credits

The State of Colorado does not impose personal property taxes or inventory taxes on businesses. There is not a unitary state tax; neither the city of Pueblo nor Pueblo County imposes any local income taxes.

Certain state and federal tax credits serve as an encouragement to business expansion:

  • The Inventory Tax Credit is a refund against state income taxes which allows a 100 percent (100%) credit on local property taxes paid on business inventories.
  • The “new Colorado investment tax credit” allows an amount equal to 10% of the total qualified investment as determined under section 46© of the Internal Revenue Code for qualified property as defined in section 48 as such sections existed prior to the Revenue Reconciliation Act of 1990.
  • The “new investment tax credit” is basically 10% of what the federal regular percentage Investment Tax Credit would be if it were still in effect.
  • The “old investment tax credit” was 10% of the current year federal investment credit, which includes the rehabilitation, energy and reforestation investment credits on assets located in Colorado. The credit is limited to the first $5,000 of tax liability plus 25% of the tax in excess of $5,000.
  • Purchases of manufacturing equipment and machine tools and parts are exempt from the two point nine percent (2.9%) state sales and use tax and the one percent (1%) county tax. To qualify the machinery must: (1) be used in Colorado, (2) be used directly and predominantly to manufacture tangible personal property for sale or profit, (3) be of a nature that would have qualified for the federal investment tax credit under the definition of section 38 property. This includes tangible personal property with a useful life of one year or more and limits qualifying purchases of used equipment to a maximum of $150,000 annually, (4) be included on a purchase order or invoice totaling more than $500, and (5) be capitalized.
  • An income tax credit of $1,200 per employee is available for hiring qualified new aviation zone employees for aircraft manufacturers located in a Colorado aviation development zone. The Pueblo Airport is located in an aviation development zone.