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Business Development
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Frequently Asked Questions About Wisconsin's Technology Zones  Who
is eligible for Wisconsin Technology Zone tax credits?
Who is eligible for Wisconsin Technology Zone tax credits? The Department of Commerce will certify busineses for tax credits based on a company's ability to create jobs and investment and to attract related businesses. Criteria includes:
What if my business doesn't develop software, build computers or do biomedical research? The Technology Zone program focuses primarily on businesses engaged in research, development or the manufacture of advanced products or materials used in a variety of identified fields. However, local Technology Zones may also recommend certification of businesses that they identify as part of a target cluster and as knowledge-based businesses, or businesses that utilize advanced technology production processes, systems or equipment in more traditional manufacturing operations. How can I get my business in the Technology Zone program? 1. The first step is to contact local representatives of the Technology Zone. They will explain the basic operation of the program, answer questions and determine if a business meets local criteria for Technology Zone tax credits. 2. If the local Technology Zone representatives feel the project is appropriate for the program, the business will fill out a Prospect Data Sheet (PDS) and a PDS addendum, with assistance from the local Technology Zone representatives. 3. The local Technology Zone will recommend a total, three-year tax credit allocation to the Department of Commerce. This allocation will be based on: A. The increase in
property taxes paid directly by the business over the three-year period; The local Technology Zone will also consider factors such as job creation, the nature of technology involved, the project's impact on other high-technology businesses in the area and the importance of tax credits to the project. 4. The local Technology Zone recommendation will be reviewed by Department of Commerce Staff, who will then make a recommendation to the Department Secretary. 5. If the application is approved, the business will be notified in writing of its designation as a Wisconsin Technology Zone business. Do I have to apply through the local Technology Zones or can I go straight to the Department of Commerce? The Technology Zone program is a partnership between the State of Wisconsin and its designated Technology Zones. The Department has established some criteria that is effective statewide, but each individual Technology Zone has its own specific criteria relating to the type of businesses that may be eligible for tax credits, maximum allocation levels per project and possible maximum/minimum investment and job creation levels. Therefore, it is imperative that businesses contact tlocal Technology Zone representatives. These individuals may also provide information on additional incentives that may be helpful to your business. What do I have to do to receive my tax credits once I'm in the program? You can claim the tax credits your business has earned by submitting annual reports to the Deparment of Commerce. You will be asked to provide information relating to the amount of investment that took place in the past fiscal year; payroll information indicating the wages paid to employees hired to fill new positions created as part of your project; and documentation showing the property taxes paid by your business during the past fiscal year. Commerce staff will issue annual tax credit verification forms that you will attach to your Wisconsin income tax returns. Will a business always receive its full allocation of tax credits? A business must show proof of its actual capital expenditures, first-year wages for new positions and property tax payments on an annual basis. The tax credits that a business earns are based on these actual figures. Therefore, the tax credits earned may be lower than the original allocation, which is based on the projections provided by the business. How long can a business participate in the Technology Zone program? By Wisconsin statute, businesses are designated as Technology Zone participants for three consecutive years. At the end of that period, the local Technology Zone representatives may recommend that the Department of Commerce extend the business' designation for an additional two years IF the business meets its original projections for job creation and investment over those three years and IF the business shows evidence that it will continue to grow during the two-year extension. What if I can't use all of my credits right away? While your current tax situation may prevent you from initially taking advantage of your tax credits, you have 15 years from the time you receive credits to actually apply them against your Wisconsin income tax liability. |
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The business must
be a new or expanding high-technology firm.