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Hawkeye Ribbon Cutting

Investment Cost Credit

This incentive is not widely known or applied. It is available to investors in Zone businesses. Taxpayers who purchase an ownership interest in a Zone business may be eligible for a credit on their state tax liability, up to 30% of the total investment.

A purchase is a qualified investment if:

  • the business is viable;
  • the business has not been disqualified from UEZ incentives or benefits;
  • the taxpayer has a legitimate purpose for the purchase of the interest;
  • the purchase would not be made unless a credit is allowed;
  • the purchase is critical to the commencement, enhancement, or expansion of business operations in the Zone and will not merely transfer ownership, and the purchase proceeds will be used only in business operations in the Zone.

The percentage of the credit depends upon:

  • the type of business (e.g. whether it is manufacturing, retail, professional, high tech, or warehousing)
  • the amount of the investment in real or personal property
  • the number of new jobs the investment will create and the percentage of those jobs that will be reserved for Zone residents;
  • the amount of equity financing.