Renewal Community
Foreign Trade Zones
Renewal Community
The Department of Housing and Urban Development (HUD) has designated Charleston a "
"Renewal Community", eligible to share in an estimated $17 billion in tax incentives to stimulate job growth, promote economic development and create affordable housing. The 2000 Community Renewal Tax Relief Act established the Renewal Community Initiative that encourages public-private collaboration to generate economic development in 40 communities around the country.
As a result of this Renewal Community designation,
certain areas of Charleston receive
regulatory relief and tax breaks to help local businesses provide more jobs and promote community revitalization. Renewal Communities will use the power of public and private partnerships to build a framework of economic revitalization in certain areas of the City.
New and existing businesses in portions of the Digital Corridor?s Gateway, University and Wharf Districts can take advantage of wage credits, tax deductions, capital gains exclusions and bond financing to stimulate economic development and job growth. Each incentive is tailored to meet the particular needs of a business and offers a significant inducement for companies to locate and hire additional workers. Financial incentives include:
Tax Credits
Wage credits are especially attractive to businesses looking to grow. These businesses are able to hire and retain RC residents and apply the credits against their federal tax liability. Businesses operating in the new Renewal Community will enjoy up to a $1,500 credit for every newly hired or existing employee who lives and works in the RC.
Work Opportunity Credits provide businesses in Renewal Communities with up to $2,400 against their Federal tax liability for each employee hired from groups with traditionally high unemployment rates or other special employment needs, including youth who live in the RC.
Welfare to Work Credits offer businesses a credit of up to $3,500 (in the first year of employment) and $5,000 (in the second year) for each newly hired long-term welfare recipient.
Tax Deductions
Commercial Revitalization Deductions permit a State with one or more RCs to deduct $12 million per RC per year, up to $10 million per project for commercial or industrial buildings developed in the RCs. A business can deduct up to $5 million in the year the building is placed in service or deduct the full amount of eligible expenditures pro rata over 10 years.
Section 179 Deductions under the tax code allow a qualified Renewal Community business to expense up to $35,000 of additional qualified property such as equipment and machinery acquired each year during the period of the RC designation, 2002 through 2009.
Environmental Cleanup Cost Deductions allow businesses to deduct qualified cleanup costs in Brownfields.
Capital Gains Exclusions
Zero Percent Capital Gains Rate applies to an interest in, or property of, certain businesses operating in a Renewal Community, if the asset is acquired during the period of the RC designation and held for at least 5 years.
For more information on Charleston's Renewal Community, please contact
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Foreign Trade Zones (FTZ)
Companies involved in international trade can take advantage of nearly a dozen general-purpose sites within Foreign Trade Zone 21, comprising more than 6,000 acres (2,428 hectares) of space. The South Carolina State Ports Authority serves as the grantee of FTZ 21.
FTZs are restricted-access sites that allow businesses to store and process goods or raw materials duty and quota free until they're transported into the Customs territory of the United States or into another NAFTA country (Canada and Mexico).
To learn more about FTZs and the sites located in the Charleston region, please contact
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at the Port of Charleston, or visit the Port of Charleston's site relevant to
FTZ's
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