Keystone Innovation Zone (KIZ) Tax Credit Program
Overview
An incentive program that provides tax credits to for-profit companies less than eight years old operating within specific targeted industries within the boundaries of a Keystone Innovation Zone (KIZ). With a total pool of up to $15 million in tax credits available to KIZ companies annually, the KIZ tax credit program significantly contributes to the ability of young KIZ companies to transition through the stages of growth.
Applications must be submitted on or before September 15 of each year.
Uses
Tax credits must be applied against the tax liability of a KIZ company for the tax year in which the KIZ Tax Credit was issued. Unused KIZ Tax Credits may applied against the tax liability of the KIZ company for up to five years from date the KIZ Tax Credit is issued or may be reassigned/sold to another taxpayer.
Eligibility
For-profit business entities 1) located within the geographic boundaries of a particular KIZ, 2) in operation less than 8 years, 3) operating within one of the KIZ targeted industry segments or sectors, 4) and meeting any other requirements as specified by the DCED, may be qualified KIZ Companies and eligible to participate in the KIZ Tax Credit Program. Applications must be submitted on or before September 15 of each year. The KIZ Tax Credits will be awarded on December 15th of the year the application was submitted.
Funding
A KIZ company may claim a tax credit equal to 50% of the increase in that KIZ Company’s gross revenues in the immediately preceding taxable year attributable to activities in the KIZ, over the KIZ Company’s gross revenues in the second preceding taxable year attributable to its activities in the KIZ. The KIZ Tax Credit is limited to $100,000 annually per KIZ company.
Terms
The KIZ Tax Credit must first be applied against the KIZ company’s own tax liability under Articles III (Personal Income Tax), or IV (Corporate Net Income Tax) of the Pennsylvania Tax Reform Code of 1971. Unused KIZ Tax Credits may applied against the tax liability of the KIZ company for up to five years from date the KIZ Tax Credit is issued or may be reassigned/sold to another taxpayer.
How to Apply
The Single Application must be submitted online at Single Application. For assistance in completing the Single Application, call 1.800.379.7448.
FAQs
For specific questions on this program, contact DCED’s Technology Investment Office at: saraspisho@pa.gov.
Additional Information
Program Case Study
Factsheet
KIZ Coordinator Contact Information
Sales Assignment Application Form
Please send all KIZ Tax Credit Claim Forms to the following address:Pennsylvania Department of Revenue
Office of Economic Development
327 WALNUT ST FL 11
HARRISBURG PA 17128-2005
How To Apply For The 2019 Tax Credit
- KIZ Tax Credit Worksheet for 2018 Non-Apportionment – For companies with only one location in Pennsylvania (inside a KIZ).
- KIZ Tax Credit Worksheet for 2018 – For companies with multiple locations within Pennsylvania (inside AND outside a KIZ).
- KIZ Tax Credit Application Presentation 2019 – A helpful walk through explaining the application process.
- KIZ Coordinator Certification Form 2019
- KIZ Tax Credit Sale and Assignment Affidavit 2019
- KIZ Tax Compliance Form 2019 – In addition to the >20% owners listed on the above Tax Compliance Form, please attach a document which lists all owners of the company with their percentage ownership. This attachment should equal 100% of company ownership.
Tax Credit Compliance Forms and the subsequent ownership attachment can be mailed to:
Department of Community & Economic Development
Commonwealth Keystone Building
KIZ Tax Credit Program – Sarah Spishock
400 North St
4th Floor
Harrisburg, PA 17120
Reminder: These forms must be postmarked by September 15, 2019.