In today’s world, being in a position to take advantage of opportunities gives you leverage.  The Mid Iowa Growth Partnership region provides an economic and business climate that is proactive in the development, expansion and retention of business & industry.

Regional Tax Incentives (vary by county)

– Commercial & Industrial Tax Abatement: Iowa law allows cities and counties to abate local property taxes for value added to industrial real estate.

– High Quality Jobs:

The High Quality Jobs program provides qualifying businesses tax credits and direct financial assistance to off-set some of the costs incurred to locate, expand or modernize an Iowa facility. To qualify for this very flexible assistance package that includes loans, forgivable loans, tax credits, exemptions and/ or refunds, eligible businesses must meet certain wage threshold requirements.  Visit wage requirements to view the requirements for wage thresholds.

Eligibility Requirements:

  • A business must meet wage thresholds requirements.
  • Actual award amounts will be based on the business’s level of need; the quality of the jobs; the percentage of created or retained jobs defined as high-quality; and the economic impact of the project.
  • Created jobs must pay at least 100 percent of the qualifying wage threshold at the start of the project and 120 percent of the qualifying wage threshold by project completion and through the project maintenance period unless in a distressed area.
  • Retained jobs must pay at least 120 percent of the qualifying wage threshold throughout the project completion and maintenance periods.
  • The business must provide a sufficient benefits package to all full time employees that includes at least one of the following:
    • Business pays 80 percent of medical and dental premiums for single coverage plans, OR
    • Business pays 50 percent of medical and dental premiums for family coverage plans, OR
    • Business pays for some level of medical and dental coverage and provides the monetary equivalent value through other employee benefits.

Tax Incentives:

  • The State’s refundable research activities credit may be increased while the business is participating in the program.
  • A local property tax exemption of up to 100 percent of the value added to the property to a period not to exceed 20 years may be available.
  • An investment tax credit equal to a percentage of the qualifying investment, amortized over five years. This tax credit is earned when the corresponding asset is placed in service and can be carried forward for up to seven additional years or until depleted, whichever occurs first.
  • A refund of state sales, service or use taxes paid to contractors or subcontractors during construction.
  • For distribution center projects, a refund of sales and use taxes paid on racks, shelving, and conveyor equipment.

To assure your addition/expansion can benefit from this program, businesses must apply prior to the beginning of the project.

– Tax Increment Financing: City councils or county boards of supervisors may use the property taxes resulting from the increase in taxable valuation caused by the construction of new industrial or commercial facilities to provide economic development incentives to a business or industry. Tax Increment Financing may be used to offset the cost of public improvements and utilities that will serve the new private development, to finance direct grants or loans to a company, or to provide the local match for federal or state economic development assistance programs.

State Tax Incentives

– Iowa Corporate Income Tax: A number of features of Iowa’s corporate income tax offer significant advantages when compared to other state’s corporate taxes. Fifty percent deductibility of federal taxes from Iowa corporate income tax. Single-factor, non-unitary tax. Iowa’s tax is based only on the percentage of total sales income within the state. Iowa corporate income tax may be reduced or eliminated by the New Jobs Tax Credit & Enterprise Zone Tax Credit.

– No Sales or Use Tax on Manufacturing Machinery and Equipment Purchases

– No Property Tax on New Industrial Machinery and Equipment

– No Personal Property (Inventory) Tax

– No Sales & Use Tax

– Pollution Control or Recycling Property Tax Exemption: Pollution control and recycling equipment may be eligible for a property tax exemption. Improvements to real property that are primarily used to control pollution of air or water, or primarily used for recycling, may qualify. An application must be filed for exemption.

– Unemployment Insurance: Iowa has the lowest new employer unemployment insurance rate in the nation. The rate for all non-construction business is 1 percent for a three-year period until an experience rating is established. Iowa offers a zero rate for good experience; approximately 45 percent of Iowa employers are at a zero rate.

– New Jobs Tax Credit: A business entering into an agreement under the state’s training program and increasing its workforce by at least 10 percent – may qualify for this Iowa corporate income tax credit. This credit is equal to 6 percent of the state unemployment insurance taxable wage base. The credit for 2005 is up to $1,204 per new employee and can be carried forward up to 10 years.

– Research & Development Tax Credit: A credit for increasing research activities is 6.5 percent of the company’s allotted share of qualifying research expenditures in Iowa. A company must meet the qualifications of the federal research activities credit in order to be eligible for the credit on the Iowa return.

– Assistive Device Tax Credit: Iowa small businesses can reduce their taxes by buying or renting products or equipment, or by making physical changes to the workplace to help employees with disabilities get or keep a job.

– New Market Tax Credit: Areas located in a Distressed Tract or an Out Migration Tract may be eligible for other financial incentives.

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Financial Assistance

The Mid Iowa Growth Partnership works closely with city, county, regional and state groups to offer a comprehensive business growth system.  Our region has a proven track record of pro-business community assistance initiatives and economic development assistance programs targeted specifically to the needs of existing and prospective businesses in multiple business sectors, such as: Renewable Energy/Biotech (ethanol, biodiesel, bioprocessing, etc.), Advanced Manufacturing (fabrication, plastics, electronics, etc.), Information Solutions (communications, educational service, etc.) and Warehousing & Distribution.