Local businesses are leaving money on the table by not taking advantage of tax credits offered for rural counties.
Montezuma, Dolores, and San Juan counties are state enterprise zones, which allow businesses additional tax relief for hiring new employees, staff training, insurance, business investment, and more.
But just half of businesses are signing up, says Chris Burkett, director of the Montezuma County Economic Development Council.
“A lot of local businesses are not aware of these tax credits available to them,” he said. “It’s money in their pocket, and it just takes five minutes to sign up.”
Dolores and San Juan counties qualify as an Enhanced Rural Enterprise Zone, a status that offers even more tax benefits.
Lara Lewis, a specialist with Region 9 Economic Development, said the enterprise zone tax benefits are designed to keep money in struggling rural economies. The tax credits also are incentives for businesses to expand.
For example, businesses can get three percent back on equipment purchases at tax time. For hiring a new employee for one year, a business can get $1,100 tax credit.
“The amount comes directly off of the top of their tax bill. It’s significant savings,” Lewis said.
Enterprise tax credits are available for all businesses in Dolores and Montezuma counties – restaurants, retail, and medical, construction, manufacturing and agriculture.
Officials are campaigning to make businesses more aware of the tax benefits. During the past year, Burkett has surveyed 100 local businesses to see if they are taking advantage.
“I’d say 90 percent were not signed up,” he said. “A larger business realized they could have saved $10,000 from the equipment they purchased.”
Lewis said businesses with CPAs typically know about the enterprise zone benefits and take advantage for their clients.
“We’re trying to promote the benefits to mom-and-pop stores as well,” she said. “We want the bookkeepers to call us.”
Also the tax benefits carry over year-to-year for start-up businesses that don’t have tax liabilities in their early years.
“We’re telling businesses to not put it off, because if you have an unexpected purchase and have not signed up, you will not get the credit,” Burkett said.
To be eligible for the enterprise zone tax credits, sign up via the Region 9 website at www.scan.org. Click on enterprise zone, click on Advanced Colorado website, then apply for enterprise zone precertification.
Nore Information: Burkett at (970) 560-5581 or Lewis at (970) 247-9621
jmimiaga@cortezjournal.com