There are nine state tax credits available to businesses within the Zone and one state tax credit available to any taxpayer with a state tax liability.
To find out more about the credits, and to file for Enterprise Zone Certification, please click the link below. This link will take you to the Colorado Office of Economic Development website which provides FYIs on the various tax credits. Work with your Certified Public Accountant to submit your pre-certification and certification online here.
EZ Forms and Information
New Business or Expansion Business Facility Jobs Credits
A business new to or an existing business expanding its employee base in the Denver Enterprise Zone may receive up to a $500 State tax credit for each new job created. In order to qualify the business must be located in the Zone and be one of the following:
New Business Facility - A newly constructed or leased facility used by the taxpayer to operate a revenue producing enterprise.
New Business Expansion Facility - A facility which expands by increasing its employee base at least 10% or 10 additional employees, whichever is less, or makes new equipment purchases (Section 38 property) of at least $1 million or, if less, at least double the original investment. The business does not have to be "new".
The credit is pro-rated at $41.67 per month per employee. For example, if the job remains all year, the credit is $500. If the job exists only for 6 months, the credit would be $250. A new business facility is eligible for a credit for all of the jobs it creates in its first year. A new business expansion facility is eligible for credit for the net jobs created using the prior highest annual average number of employees as a base year. Please see the Department of Revenue's FYI Enterprise Zone New Business Facility Employee Credits, Income #10.
Three Percent Investment Tax Credit
Businesses located in the Denver Enterprise Zone making purchases of what the Federal government deems as Section 38 Property (equipment, computers, furniture, vehicles, etc.) used exclusively in the Enterprise Zone for at least one year may claim a tax credit equal to 3% of the investment amount. The credit cannot exceed 100% of the taxpayer's State income tax liability up to $5,000 and 50% of the tax liability above $5,000. The unused portion of the credit may be carried forward for twelve years and back three years. Please see the Department of Revenue's FYI Enterprise Zone Investment Tax Credit, Income #11
Job Training Tax Credit
Employers in the Denver Enterprise Zone who provide a qualified job training program for their Enterprise Zone employees may claim a tax credit of 10% of their eligible training "investment" beginning with tax years starting on or after January 1, 1997. A qualified job training program means a structured training or basic education program to improve the job skills of the taxpayer's employees. The training can be on or off-site. Please see the Department of Revenue's FYI Enterprise Zone Qualified Job Training Program Investment Credit, Income #31.
Manufacturing Equipment State Sales Tax Exemption
Manufacturing businesses in the Denver Enterprise Zone are exempt from State sales and use tax on purchases of $500 or more of machinery, machine tools, or parts for either. The equipment and/or parts must be used in Colorado (in the Zone) directly and exclusively by a business in manufacturing tangible personal property for sale or profit. At the time of purchase, a "Purchase of Machinery" and "Machine Tools" Form DR 1191 must be filed with the vendor from which the item is purchased and with the Colorado Department of Revenue. Please see the Department of Revenue's FYI Sales and Use Tax Exemption for Manufacturing Equipment, Sales #10
Employer-Sponsored Health Insurance Tax Credit
A Denver Enterprise Zone taxpayer who qualifies for the New Business Facility or Expansion Facility Jobs Tax Credit (see above) can also qualify for an additional credit of $200 for the first two full tax years of operation. The credit is available for each employee who is insured under a health insurance plan provided by the employer where the employer pays at least 50% of the insurance premium. This credit will carry forward 5 years. Please see the Department of Revenue's FYI Enterprise Zone New Business Facility Employee Credits, Income #10.
Rehabilitation of Vacant Buildings
Businesses in the Denver Enterprise Zone are eligible for a 25% State tax credit if they rehabilitate a building that is at least 20 years old and has been vacant for at least two years. The credit is 25% (up to $50,000) of the business' hard costs to rehabilitate the building for commercial use. Please see the Department of Revenue's FYI Tax Credit for the Rehabilitation of Vacant Commercial Buildings in an Enterprise Zone, Income #24.
New Business Agricultural Processing Credit
A $500 State tax credit is available per New Business Facility or Business Expansion Facility employee to any taxpayer who operates a business within the Denver Enterprise Zone that manufactures or processes an agricultural commodity. Please see the Department of Revenue's FYI Enterprise Zone New Business Facility Employee Credits, Income #10.
Research and Development (R&D) Tax Credit
A 3% State tax credit is available for private expenditures on research and experimental activities (as defined in federal tax law) conducted in the Denver Enterprise Zone. This credit equals 3% of the amount of the increase in the taxpayer's R&D expenditures above the average of R&D expenditures within the zone area in the previous two years. No more than one fourth of the allowable credit may be taken in any one tax year. Please see the Department of Revenue's FYI Research and Development Income Tax Credit for Enterprise Zones, Income #22.
Credits for Contributions to Zone Projects
Any taxpayer who makes a monetary or in-kind contribution to a certified Denver Enterprise Zone Contribution Project may take a tax credit of up to $100,000 per tax year for cash contributions and a credit up to $50,000 for in-kind contributions. The total credit is limited to 25% for cash contributions and 12.5% for in-kind contributions. Any excess credit may be carried forward for up to 5 years. Please see the Department of Revenue's FYI Tax Credits for Contributions to Enterprise Zone Administrators, Programs, Projects or Organizations.
West Colfax between Sheridan and Federal
West Colfax between Sheridan and Federal, in Denver, is part of the Jefferson County Enterprise Zone administered by the City of Lakewood. For questions please contact:
Jefferson County Enterprise Zone
1536 Cole Blvd., #100
Golden, CO 80401-3219
Phone: (303) 202-2965
Fax: (303) 202-2967
For More Information
For more information on the Denver Enterprise Zone, please contact the Zone Administrator at:
Denver Office of Economic Development
Enterprise Zone Manager
201 West Colfax Avenue, Dept. 200
Denver, CO 80202
View Denver Enterprise Zone Brochure