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Lehigh Valley Economic Development Corporation

Financings

Tax Credits and Incentives Available to Lehigh Valley Businesses

Job Creation Tax Credits

This program provides a $1,000 tax credit to approved businesses that agree to create jobs in the Commonwealth within three years. A business must agree to create at least 25 jobs, or new jobs equaling at least 20 percent of the existing workforce. Twenty-five percent of the tax credits allocated each year must go to businesses with less than 26 employees. The tax credits may not be utilized by a business until the jobs are actually created.

Keystone Innovation Zone

A KIZ Tax Credit is available to companies located within the KIZ boundaries if the company is 8 years old or less. $25 million in total funds are available. In addition, a Research and Development Tax Credit is available to businesses with about $30 million available. The R&D tax credits that are not used by a business can be sold, creating a revenue source for a growing company.

Keystone Opportunity Zone

Depending on the situation, the tax burden may be reduced to zero for eligible companies located in the zone through exemptions, deductions, abatements and credits for the following:

State
  • Corporate net income tax
  • Capital stock and foreign franchise tax
  • Personal income tax
  • Sales and use tax on purchases consumed and used by a business in the Zone
  • Mutual thrift institution tax
  • Band and trust company shares tax
  • Insurance premiums tax
Local
  • Earned income/net profits tax
  • Business gross receipts, business occupancy, business privilege and mercantile tax
  • Sales and use tax on purchases consumed and used by a business in the zone
  • Property taxes – including school district
Foreign Trade Zone #272

Duty Deferral:
Imported products admitted to the FTZ are not entered into the Customs territory until their withdrawal from the FTZ. Therefore, users obtain a cash flow savings by deferring Customs duties until the merchandise leaves the FTZ for consumption in the United States.

Duty Reduction:
Imported products admitted to the FTZ can be placed in a special status that allows the merchandise to be classified and appraised in its condition as withdrawn from the FTZ. For manufacturers this means that an imported component with a higher rate of duty can be classified and appraised in its finished product form, with a potentially lower rate of duty, thereby reducing the amount of duty owed. Special permission is required from the FTZB prior to accessing duty reduction benefits in FTZs.

Duty Elimination:
Imported products admitted to the FTZ and subsequently destroyed in the FTZ or exported from the FTZ are not subject to Customs duties.

Zone-to-Zone Transfers:
If the company utilizes more than one FTZ, merchandise may be transferred from zone to zone in order to extend the deferral benefits further. This benefit can be implemented up and down the supply chain by incorporating the activities of suppliers and customers.

LVEDC Loans & Interest Rates

Details Here

Type Rate Date
PIDA 2.25 3/5/14
SBA 504 5.30 3/5/14
SBFF 1.75 3/5/14
MELF 1.75 3/5/14