During its October, 2011 Special Session, the Connecticut General Assembly adopted, and on October 27, 2011, Governor Malloy signed into law, House Bill No. 6801, An Act Promoting Economic Growth and Job Creation in the State (the “Act”). One of the most significant items in this Act is the Job Expansion Tax Credit.Below is an overview of the program, eligibility requirements and information on where and how to apply for the credit.
Connecticut businesses can be eligible for tax credits of $500 per month for each new full-time job created. The tax credit is increased to $900 per month in the case of certain workers that have exhausted their unemployment benefits, are in or have been honorably discharged from the armed forces, or are receiving certain vocational services from the Bureau of Rehabilitative Services.
The credit can be applied against the corporation business, or personal income tax. Applicants must be subject to one of the foregoing taxes and have been in business for at least 12 consecutive months prior to the date of application.
In order to be eligible, an employer with 50 or fewer full-time employees must hire at least one new full-time employee. An employer with more than 50 and fewer than 100 full-time employees must hire at least five new full-time employees. An employer with more than 100 full-time employees must hire at least 10 new employees. Each full time job to which the credit applies must:
1.Not have existed in Connecticut prior to the application date
2.Require at least 35 hours of full time work per week for not less than forty-eight weeks in a calendar year and not be temporary or seasonal
3.Be filled with a newly hired full-time employee who was not employed in Connecticut by a related party during the prior twelve months
4.Must not be an owner, member or partner in the business
5.Must be employed at the close of the income year of the qualified business
6.Must be created on or after January 1, 2012 and prior to January 1, 2014
7.Result in a net increase in full-time employment from baseline start date (application date) to the end of the reporting period.
Application Process: An eligibility application must be submitted to the Connecticut Department of Economic and Community Development.A review will then be conducted by the office and a tax credit eligibility letter is submitted to the applicant. To apply complete and submit the JET Application found at www.ct.gov/ecd/under Business & Industry Development, Tax Incentives.