Effective January 1, 1999 the State of Missouri has enacted new incentive legislation, the Rebuilding Communities Tax Act which provides State Tax Incentives for certain types of businesses which relocate or invest in a designated "Rebuilding Community." The entire City of St. Louis has been designated as eligible for this program incentive.

Eligible Business

Eligible businesses include corporations, partnerships, and proprietors with fewer than 100 employees. 75% of the companies’ employees must be located in or relocating to the City of St. Louis.

Types of business operations eligible to receive Rebuilding Communities Tax Credits are:

Manufacturers Professional Firms Computer Programming Telecommunications Companies

Medical Devices Scientific Research Biomedical Computer Software Design or Development

PROGRAM BENEFITS

The program provides tax credits to eligible companies which relocate to the designated Rebuilding Community, or those eligible businesses already in the designated community making specialized equipment purchases, specifically a new or relocating company receives either:

• A 40% tax credit to the taxpayer for each of the 3 years after such a move, based upon 40% of their income taxes due. The maximum amount of credits per taxpayer is $125,000 for each of the three years for which the credit is claimed; or

• a 40% Specialized Equipment Credit which provides 40% of the amount of funds expended for computer equipment, research laboratory equipment, manufacturing equipment, fiber optic equipment, high speed telecommunications, wiring or software development expense. The maximum credit is $75,000 per year per taxpayer for each of the three years after commencing operations or moving into the qualifying rebuilding community.

Additionally, the individual employees of the eligible business facility may receive a tax credit against State Income Tax equal to 1.5% of their gross salary paid at the facility for each of the three years that the facility (the company) receives the tax credit.

An eligible existing (already located in designated community) business can qualify for:

• A 25% Specialized Equipment credit for those businesses which expended funds for computer equipment and its maintenance, medical laboratories and equipment, research laboratory equipment, manufacturing equipment, fiber optic equipment, high speed telecommunications, wiring or software development expense. Expenses exceeding its average expense for the 2 prior years shall be eligible to receive a 25% State Tax Credit to a maximum of $75,000 in credit per business.

Note: If a qualifying existing company anticipates doubling their existing employment within one year the State will allow the expansion to qualify for the same benefits afforded to a relocating company.

USE OF CREDITS:

Business credits may be used for taxes owed in 3 previous years and in any of the 5 tax years thereafter. These credits may be transferred, sold or assigned.