Small Business [fast growth] Tax Credits

Georgia income tax credits are available to a small business having Georgia net taxable income growth of 20% or more each year for three consecutive years. The credit in year 3 is the difference in the net taxable income of year 3 and year 2. Eligible companies include the same categories that can receive the job tax credit on page 1 except for retail businesses.

Example: Taxpayer’s net taxable income increases by 20% or more for three consecutive years. In year 3, the net taxable income is $1 million. The net taxable income in year 2 was $300,000. Taxpayer is eligible to receive a $700,000 tax credit: [$1,000,000 – $300,000].

The small business credit can be used against 50% of the remaining Georgia income tax liability after all other credits have been applied in a given year. There is no carry forward provision. This process can continue until the taxpayer’s Georgia income tax liability exceeds $1.5 million, at which time the taxpayer would no longer be considered a small business.

This credit may be combined with other tax credits.