ILLINOIS ENTERPRISE ZONE PROGRAM
TAX QUESTIONS AND ANSWERS

JOBS TAX CREDIT

What is the enterprise zone jobs tax credit? - The enterprise zone jobs tax credit 35 ILCS 5/201 offers employers a tax credit on their Illinois income taxes for hiring individuals who are certified as economically disadvantaged or as dislocated workers.

How much is the tax credit? - An employer who conducts a trade or business in an enterprise zone is allowed a credit of $500 per eligible employee hired to work in a zone during the taxable year. Any unused portion of the credit may be carried forward five years. The credit must be applied to the earliest year for which there is a tax liability.

How do employers qualify for the jobs tax credit? - To qualify for the credit: a minimum of five eligible employees must be hired in a zone during the taxable year; and, the taxpayer's total employees must increase by five beyond the total employed in the zone at the end of the previous tax year for which a jobs tax credit was taken.

What individuals qualify as eligible employees for the Jobs Tax Credit? - An employee must be: 1) certified by a Substate Grantee (SSG) or Service Delivery Area Administrative Entity (SDA) as "eligible for services" under Titles II or III of the Job Training Partnership Act (JTPA); 2) employed in an enterprise zone where the employee either works in the zone or the zone is the base of operations for the services performed; and, 3) employed at least 180 consecutive days for 30 or more hours per week.

How do employers obtain jobs tax credit eligible individuals? - An employer should list job openings with the local SSG or SDA, note that the business is within an enterprise zone, and specify that the business seeks to hire workers certified as eligible for services under Titles II or III of JTPA. If employers have job applicants who have not been referred by the SSG or SDA, they can offer to determine if they are eligible. Eligible individuals will be issued a Jobs Tax Credit Certification Voucher to present to prospective employers. When a person is hired, the employer keeps the voucher for tax records. That is all the paperwork required.

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