1. What is the Yuba-Sutter Enterprise Zone?
2. How do I qualify for the tax benefit?
3. How long does the program last?
4. How are the tax credits applied to the state income tax due?
5. If I have job openings, how do I find qualified candidates?
6. Am I limited to hiring only Yuba-Sutter residents?
7. Is there a way for employees who work in the zone to take advantage of tax benefits?
8. If I recently hired a new employee and want to see if they qualify my company for the hiring tax credit, what should I do?
9. If I terminate an employee hired as a qualified employee for the EZ hiring credit, will there be a recapture of the credit claim

What is the Yuba-Sutter Enterprise Zone?

It is a state-sponsored tax benefit program which is designed to reduce the cost of doing business. 

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How do I qualify for the tax benefit?

All businesses located within the zone boundaries are eligible for benefits.  Your zone address qualifies you automatically for the opportunity to earn tax credits.  There is no fee or tax to participate in the zone program.  See Zone Map for specific location or Address Ranges to verify if you are located within the boundaries of the Zone.

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How long does the program last?

It lasts for 15 years from designation.  The Yuba-Sutter Enterprise Zone was designated on October 15, 1986, and has received a 5-year extension allowed by the state through a competitive application process.  The zone will end on October 15, 2006.    New legislation to allow additional extensions have not been approved to date.  More information is expected by the end of the year.

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How are the tax credits applied to the state income tax due?

The tax credits reduce the amount of TAX LIABILITY DUE (from the bottom line) and do not just reduce the amount of taxable income.

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If I have job openings, how do I find qualified candidates?

As a free service to Yuba-Sutter enterprise zone businesses, the One Stop Centers for Business and Workforce Development will assist businesses in processing job orders and help identify eligible applicants.

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Am I limited to hiring only Yuba-Sutter residents?

No.  Eligibility is not based on residency of your employees.   An exception are those employees residing in a Targeted Employment Area (TEA).   Within the Yuba-Sutter Enterprise Zone, two (2) TEAs have been established.  Individuals hired by an EZ business (after the effective TEA date of March 4, 1997) are automatically eligible.

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Is there a way for employees who work in the zone to take advantage of tax benefits?

Yes.  However, this benefit is only available to low-wage earners.  Any person employed in the zone who earns no more than $16,333 or a married couple (both employed in the zone) earning no more than $22,167 are eligible for a tax credit of up to $525.  This credit does not apply to employees of state, federal, county, or city government agencies.  However, it does apply to individuals employed by nonprofit businesses and organizations as long as the employee's check does not come from a state, federal, county, or city government agency.

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If I recently hired a new employee and want to see if they qualify my company for the hiring tax credit, what should I do?

Hiring tax credit eligibility screening can be conducted on new hires within the first two weeks of employment.  Contact the Yuba-Sutter Enterprise Zone office at 530/741-6463.

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If I terminate an employee hired as a qualified employee for the EZ hiring credit, will there be a recapture of the credit claimed?

There will be no recapture if the termination was:  voluntary on the part of the employee; caused by the employee becoming disabled; due to employee misconduct; due to a substantial reduction in business; or carried out so that other qualified employees could be hired, creating an increase in the number of qualified employees and their hours of employment.

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Copyright © Yuba-Sutter Enterprise Zone. All rights reserved.
Revised: July 21, 2005.