Doing business in the Peach State? Not only does Georgia have a fairly low corporate tax rate and a single-factor apportionment rule—which means your business’s tax is calculated solely on the sales you make within the state—the state also has a plethora of general and industry-specific tax incentives.
Check out our full list below.
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Georgia tax incentives for businesses
Job Tax Credit
Georgia’s Job Tax Credit—which rewards certain businesses for creating new jobs—has the potential to eliminate a company’s corporate income tax liability and reduce the company’s payroll withholding obligations.
Depending on which tier your business falls into (according to the county you’re located in), could earn a credit between $1,250 and $4,000 per year for five years for every new job created. To qualify for the credit, you need to meet the below criteria:
- Be engaged in one of the following industries: manufacturing; warehousing, distribution and logistics; software development; fintech; data centers; contact centers; telecommunications; research and development facilities
- Create a new job that has a minimum 35-hour workweek, comes with health insurance benefits, and pays more than the average wage of the county with the lowest average wage in the state ($636 a week)
- Meet the minimum number of new jobs created per year—and maintain those jobs
To learn more about the Job Tax Credit, including which tier your business belongs to and how to calculate your credit amount, check out Georgia’s Business Incentives Brochure.
Quality Jobs Tax Credit
Certain businesses in Georgia are also eligible for the Quality Jobs Tax Credit, which incentivizes businesses to create jobs that have higher wages and more robust benefits. To qualify for the minimum credit, businesses need to create a job that pays at least 110% of their county’s average wage; in that case, the credit is $2,500.
However, the credit amount increases as the job’s wages increase; businesses that create jobs that pay at least 200% of the county’s average wage can earn $5,000 in tax credits per new job. If you get the Quality Jobs Tax Credit, you can apply it to your state corporate income tax, and if there’s anything left, you can apply it to your business’s state payroll withholding.
Learn more about the credit here.
Investment Tax Credit
Georgia’s Investment Tax Credit rewards qualifying businesses in manufacturing and telecommunications industries for investing in growth projects that help support the state economy.
Depending on the tier your business belongs to (determined by your county), you can get a credit for anywhere from 1% to 8% of your $100,000 investment, which you can apply to 50% of your tax liability. Eligible companies in designated rural counties within Tiers 1 and 2 can also apply their excess credits to their payroll withholding obligations.
To qualify for the credit, you need to meet one of the below criteria:
- Have operated either a manufacturing or telecommunications business in Georgia for at least three years, and make a minimum $100,000 investment in a new or existing manufacturing or telecommunications company in Georgia OR
- Have operated either a corporate facility or other support office for a manufacturing or telecommunications business in Georgia for at least three years, and make a minimum $100,000 investment in a new or existing manufacturing or telecommunications company in Georgia
Investment expenses that qualify for the credit include land acquisition costs, building improvements, manufacturing or telecommunications machinery and equipment, recycling and pollution control equipment, and defense plant manufacturing.
Find more details on the credit here.
Port Tax Credit Bonus
The Port Tax Credit Bonus is an add-on tax credit that businesses can use with either the Jobs Tax Credit or the Investment Tax Credit to offset up to 50% of their corporate income tax liability. The credit is available to businesses that already meet the qualifications for new jobs or investment credits and successfully increase imports and exports through Georgia deepwater ports by a specific amount.
To qualify, your company has to increase imports or exports by more than 10% from the previous tax year’s base amount, which can be no less than the required Port Traffic minimums: 75 net tons, five containers, 10 twenty-foot equivalent units.
Find out how to calculate your credit amount here.
Mega Project Tax Credit
Georgia’s Mega Project Tax Credit rewards large companies that make massive investments in expanding their workforce. Companies can claim a $5,250 credit per job per year if they meet the below qualifications within a six-year period:
- Hire at least 1,800 net new full-time employees
- Invest a minimum of $450 million or have a minimum payroll of $150 million
- Pay an average wage above specified minimums OR demonstrate high growth potential
Georgia Child Care Tax Credit
Georgia’s Child Care Tax Credit incentivizes business owners to provide child care for their employees with children. If a business buys or builds a state-licensed child care facility for their employees, they can get a credit equal to 100% of the cost of purchase or construction.
If a business provides or sponsors child care for their employees at a state-licensed facility, they can get a credit equal to 75% of the employer’s direct costs. Both credits are well above the federal Child Care Tax Credit, which only offers a credit of 25% of the costs.
If you qualify, you can apply your Child Care Tax Credits to 50% of your corporate income tax liability. Learn more here.
Here are a handful of other key federal tax credits available to businesses.
Retraining Tax Credit
The Retaining Tax Credit helps offset the cost of retraining existing employees on new business technology and equipment. Businesses can get a credit for 50% of their direct retraining costs (including training materials and wages paid to employees during training), up to $500 per employee per approved retraining system. The maximum is $1,250 per employee per year.
Learn more about how to get a retraining program approved by the Technical College System of Georgia here.
Research and Development Tax Credit
Georgia offers its own state Research and Development (R&D) Tax Credit for businesses investing in qualified R&D activities. In addition to new product development, that includes developing and testing new prototypes, dyes, and molds; developing and testing new manufacturing assembly line or distribution facility processes; implementing and testing new plant equipment and ERP software; and improving legacy software solutions or cloud storage.
If you qualify, you can get a credit equal to 10% of the cost of qualified R&D expenditures, which you can apply to 50% of your company’s net Georgia corporate income tax. You can also use any excess credits to reduce your payroll withholding.
To qualify for the credit, you need to be engaged in one of these industries: manufacturing; warehousing, distribution and logistics; software development; fintech; data centers; contact centers; telecommunications; or research and development facilities.
See more information about how to qualify for the credit—and calculate it—here.
Plus, here’s everything you need to know about the federal R&D credit.
Life Sciences Manufacturing Tax Credit Bonus
An add-on to the Job Tax Credit, the Life Sciences Manufacturing Tax Credit Bonus gives qualifying companies an additional $1,250 for creating jobs that manufacture pharmaceuticals, medicines, and medical equipment and supplies in Georgia.
Qualified companies can use the tax credit bonus to offset up to 100% of their corporate income tax liability, then put any excess toward their payroll withholding. To qualify, you need to meet the Job Tax Credit requirements first. The bonus only applies to jobs created after July 1, 2021.
Learn more about the bonus here.
PPE Tax Credit Bonus
Georgia’s PPT Tax Credit Bonus—available for tax years 2020 through 2024—rewards businesses for creating jobs that expand the manufacture of personal protective equipment (PPE) and hand sanitizer in Georgia. Qualified businesses can get a $1,250 bonus per new job created as long as they meet the Job Tax Credit qualifications.
Find additional information here.
Digital Entertainment Tax Credit / Film Tax Credit
The Digital Entertainment Tax Credit, also referred to as the Georgia Film Tax Credit, gives qualified digital/interactive entertainment companies a credit of 20% of qualified production expenditures in Georgia. Those qualified expenditures include materials, services, and labor—and companies need to incur a minimum of $500,000 of expenditures within Georgia.
Production and entertainment companies can also apply for an additional 10% credit if they use the Georgia logo on approved projects and link to the Georgia Film website. Interactive entertainment companies can only qualify for the credit if their gross income is less than $100 million.
Qualified companies can use the credit against their income tax liability, and put any excess toward reducing their payroll withholding. Georgia caps the available credits at $12.5 million per year, and awards them on a first-come, first-served basis. No one company can receive more than $1.5 million in credits.
Learn how to apply for Georgia film tax incentives here.
Premium Tax Credit
Insurance businesses in Georgia can qualify for the Premium Tax Credit, which offers qualified companies a credit between $750 and $3,500 for creating anywhere from five to 25 net new jobs.
Those jobs need to have a regular workweek of at least 35 hours, include reasonable health insurance benefits, and pay an average wage above the average wage of the lowest-paying county in the state.
Learn more about it here.
Georgia solar tax credits
There are no state tax credits for using solar energy or alternative energy in Georgia, but Georgia businesses can apply for the federal solar energy credit, called the Energy-Efficient Commercial Buildings Deduction.
Just because Georgia doesn’t offer a solar tax incentive doesn’t mean your business shouldn’t consider the switch. Here are eight powerful benefits of becoming a more environmentally sustainable operation.
Georgia sales and use tax exemptions
Georgia-based businesses in manufacturing, data, tech, and distribution can qualify for Georgia’s many tax exemptions.
Manufacturing companies can take sales and use tax exemptions on manufacturing machinery and equipment, repairs to industrial machinery, raw materials and packaging, energy used in manufacturing, primary material handling equipment, pollution control equipment, clean room equipment, and inventory.
Data centers and high-tech companies can take sales and use tax exemptions on certain purchases and equipment, while distribution centers can take sales and use tax exemptions on inventory and primary material handling equipment.
Learn more about Georgia tax exemptions and how to qualify here.
Georgia city and county tax credits
Many cities and counties in Georgia have local tax incentive programs that businesses can apply for. Check this list to review your county’s website for more information.
Financing resources for small businesses in Georgia
Whether you’re just starting your operation or have been operating for a while, the right financing can help you grow. If you’re looking for state-specific resources, check out Gusto’s guide to grants and loans in Georgia.
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