Invest in Denver! FOR ILLUSTRATIVE PURPOSES ONLY; APPLICATION AVAILABLE SPRING 2017 THE 2017 DENVER BUSINESS INVESTMENT PROGRAM

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Elijah Cross
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1 Invest in Denver! City & County of Denver THE 2017 DENVER BUSINESS INVESTMENT PROGRAM For investments made in 2016, Denver s business owners can get a business personal property tax credit offered through the Business Investment Program. Launched in 2013 and designed to encourage business start ups and reward existing businesses of all sizes that expand their operations here, this program incentivizes qualified businesses to expand their facilities, add new employees, and buy new equipment. WHAT IS THIS TAX CREDIT? A tax credit is a reduction of a tax bill. This tax credit is specifically for investing in business personal property, including eligible machinery, equipment, furniture, vehicles, and other items related to a commercial or industrial operation between years 2012 and (NOTE: This program is intended to encourage new or expanded business activity, so replacement equipment is not eligible.) Businesses that invested in new or expanded operations in 2016 may now apply for this tax credit through the Business Investment Program. Businesses can apply for a credit in the amount of the Denver General Fund portion of their taxes on business personal property for up to four years, starting when the property is placed in service. Investments made in subsequent years require a separate application. WHO IS ELIGIBLE? Businesses located within the City and County of Denver, through a business start up or expansion, that made significant capital investments are eligible to apply now with regard to their 2016 investments. Businesses must apply annually for consideration; the application periods for 2013, 2014 and 2015 investments are closed. We encourage any business new to Denver in 2016 to apply. For businesses established in Denver prior to 2016, you must have met at least ONE of these growth requirements in 2016 to qualify for this program: Your increased investment was at least $1 million in business expansion; Your increased investment was at least 100% of your prior business capital level; You increased by at least 10 employees over your preceding 12 month average; or You increased by at least 10 percent in employment over your preceding 12 month average. NOTE: New small business owners with business personal property valued at $7,300 or less might already be exempt from personal property tax, in which case this program is not applicable. To confirm whether your new small business is exempt, call the Assessor s Office at Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 1 of 11

2 HOW CAN THIS CREDIT BENEFIT ME? It reduces your tax liability for a four year period, which saves your business money. For example, a business that invests $1 million in a new piece of equipment for a manufacturing process can receive an estimated $12,000 in tax credits over the four year agreement period. But you don t have to invest $1 million in capital equipment; as another example, a business investing $34,000 in new furniture and equipment could still save more than $400 in taxes over the four year period if you meet one of the other growth requirements mentioned above. YOUR NEXT STEP There is an application required, but you re compiling information about your business year already, so applying for this tax credit will not represent an additional paperwork burden. It s Denver s way of recognizing that you re growing your business and Investing in Denver... and our way of saying thanks! An Application Package, which includes these instructions and the Application Form for 2016 investments, is also downloadable from Return your application via to InvestinDenver@denvergov.org, or via mail to City and County of Denver,, Business Investment Program, 201 W. Colfax Ave Dept 208, Denver, CO Do not send your application to the Denver Treasury Division or Denver Assessor s Office. For business personal property investments made in 2016, you must submit your application by Tuesday, August 1, Note that submitting your application for this tax credit does not substitute for your annual filing of a Personal Property Declaration Schedule with the Assessor s Office. Eligibility for the tax credit will be determined by compliance with Chapter 53, Article XVI, D.R.M.C. Please direct inquiries you may have on the tax credit to InvestinDenver@denvergov.org. Written inquiries will help us better address common questions. Program staff may also be contacted at Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 2 of 11

3 Invest in Denver! APPLICATION PACKAGE FOR NEW BUSINESS AND EXPANDED BUSINESS PERSONAL PROPERTY TAX CREDIT The is pleased to administer the fourth year of this business development tool, called the Business Investment Program. Through this initiative, new and expanding Denver businesses that meet the program eligibility criteria as defined in Section and , D.R.M.C, may apply for a tax credit for investing in business personal property, including but not limited to office equipment, communication equipment, tools, fixtures, machinery and equipment used in construction and manufacturing. The tax credit is in the amount of the Denver General Fund portion of your taxes on business personal property for up to four years from the year the property is placed in service. If your business made investments in 2016 that directly relate to new or expanded operations, you may now apply for the tax credit. The information collected in this application will be used to determine eligibility of the applicant. Qualifying businesses will enter into an agreement with the City & County of Denver that will set forth the terms and conditions upon which they may receive a tax credit. Investments made in subsequent years require a separate application. Replacement equipment does not qualify for the credit. Application deadline for investments made in 2016: Tuesday, August 1, QUESTIONS? For qualifying businesses personal property placed in service in 2016 Please direct any inquiries to InvestinDenver@denvergov.org. Written inquiries will help us better address common questions. Program staff may also be contacted at Note that submitting your application for this tax credit does not substitute for the annual filing of the Personal Property Declaration Schedule with the Assessor s Office. Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 3 of 11

4 APPLICATION INSTRUCTIONS for Investments made in 2016 Any existing Denver business that made investments in business personal property in 2016 and anticipates meeting the qualifying job creation or capital investment criteria listed in the application; or Any business new to Denver that added business personal property in 2016 to the newly established location. Note that new small business owners might already be exempt from personal property tax, in accordance with Colorado Revised Statutes, if the total actual (market) value of all personal property in Denver (owned and used for the business) is $7,300 or less. In such case, this business investment program is not applicable. To determine if a business falls under the new small business exemption, call the Assessor s Office at HOW DO I APPLY FOR THE TAX CREDIT FOR BUSINESS PERSONAL PROPERTY INVESTMENTS MADE IN 2016? The application package can be downloaded at or picked up at the reception desk of the (OED) on the seventh floor of the Wellington Webb Municipal Building, 201 W Colfax Ave, Denver. Available in Spring of 2017! Submit a fully completed application, including Worksheet A & B, signed and dated by an authorized company official or owner and supporting documentation by Tuesday, August 1, 2017 to City & County of Denver Business Investment Program 201 W. Colfax Ave, Dept. 208 Denver, CO Alternatively, you may the application and supporting documents to InvestinDenver@denvergov.org. SUPPORTING DOCUMENTATION: Please include the following items with your application: WHO SHOULD APPLY FOR THE BUSINESS PERSONAL PROPERTY TAX CREDIT? A copy of your business Certificate of Good Standing (available at the Colorado Secretary of State s website Form W 9 Request for Taxpayer Identification Number (available at DO NOT SEND THIS APPLICATION TO THE DENVER TREASURY DIVISION OR DENVER ASSESSOR S OFFICE. Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 4 of 11

5 WHAT HAPPENS AFTER I SUBMIT MY APPLICATION? The (OED) will review the application. Program staff may contact you to request additional information to determine eligibility. Applications of businesses that meet qualifying criteria will be forwarded to the Denver Assessor s Office for determination of eligible business personal property, allowing them to calculate and track the total amount of the tax credit. OED will communicate to the business whether the application has been approved. HOW IS MY BUSINESS PERSONAL PROPERTY TAX CREDIT CALCULATED? The tax credit available to qualifying businesses will be calculated based on the amount of taxes that would have been owed on any newly added business personal property directly attributable to the operations of the new or expanded business facility. The credit amounts to the General Fund portion of the taxes upon the business taxable personal property assessed by the City & County of Denver. You will be billed for the remaining amount of property taxes owed. As the personal property depreciates, its taxable value would also decrease, meaning the amount of the tax credit would decrease over the four year agreement period. Example 1: An existing Denver business had nine employees in 2014, then expanded resulting in the addition of two full time employees and purchased $34,000 worth of Business Personal Property (BPP) directly attributable to the expansion, both in This business is eligible since they met the criteria of an expansion resulting in "10 percent employment increase over the preceding 12-month average" and invested in BPP in Assumptions: $34,000 Business Personal Property assets purchased and placed in service in 2015 with an average 10 year life. Commercial Assessment Rate and General Fund tax rate (millage) remain constant for all four years. Actual Value of (depreciated) BPP, placed in service in 2015 Exempted Value at 29% Assessment Rate BPP credit (Equal to Denver's General Fund Portion of total BPP tax, which is mills in 2015)* Tax credit issued Year 1 (2016) Year 2 (2017) Year 3 (2018) Year 4 (2019) Assumes that business continues to meet eligibility requirements $30,967 $28,900 $25,900 $24,280 $8,980 $8,381 $7,511 $7,041 $102 $95 $85 $80 Total credit over the four year agreement period: $362 BPP credit for year 1 appears on annual tax bill received in early 2017 BPP credit for year 2, which appears on tax bill in 2018 BPP credit for year 3, which appears on tax bill in 2019 BPP credit for year 4, which appears on tax bill in 2020 * Please note that the credit applies to the General Fund portion of the BPP tax and will not be applied against taxes that are specifically pledged for other purposes, such as Denver Public Schools. The business will continue to owe personal property taxes at a reduced level. Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 5 of 11

6 Example 2: An existing Denver business invested and placed in service $1 million in Business Personal Property (BPP) in 2015, which qualified it for the BPP tax credit. In 2015, this business expanded with the investment in an additional $50,000 in BPP and the addition of 10 employees over the preceding 12 month average (adding employees would be qualifying event for the second application). Assumptions: Application #1: $1 million BPP assets purchased and placed in service in 2015 with an average 10 year life. Application #2: $50,000 BPP assets purchased and placed in service in 2015 with an average 10 year life. The Commercial Assessment Rate and General Fund tax rate (millage) remain constant for all five years. Taxable Value of (depreciated) BPP, placed in service in 2015 Application #1 Taxable Value of (depreciated) BPP, placed in service in 2016 Application #2 All Exempted Value at 29% Assessment Rate BPP credit (Denver's General Fund Portion of total BPP tax, which is mills in 2015) Year 1 (2016) Year 2 (2017) Year 3 (2018) Year 4 (2019) Year 5 (2020) Assumes business continues to meet eligibility requirements. $910,800 $850,000 $761,800 $714,000 New BIP application required for 2015 investment. $45,540 $42,496 $37,996 $35,006 $264,132 $ $233,246 $218,079 $10,152 $2,993 $2,943 $2,643 $2,470 $115 Total amount of credit for both 4 year agreement periods: $ 10,750 Please note that the credit applies to the General Fund portion of the BPP tax and will not be applied against taxes that are specifically pledged for other purposes, such as Denver Public Schools. The business will continue to owe personal property taxes at a reduced level. SECTION I GENERAL BUSINESS INFORMATION Business name and physical location: Please list the legal name of the business and the physical location of the new or expanded business facility. Businesses seeking to apply for this incentive tax credit for business personal property located at multiple locations (facilities) within the City and County of Denver need to submit a separate application for each of the business locations pertaining to the business personal property located at or within that location. FEIN#: Please enter the company s Federal Employer Identification number. If the applicant is a sole proprietor, enter the social security number of the business owner. BPP Schedule #: Please include your City property tax schedule number. Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 6 of 11

7 NAICS #: Please list the appropriate North American Industry Classification System number. For information see If unknown, please make sure to describe your business (in ten words or less) in the Primary products or services provided field of the General Business Information section. Number of employees as of December 1, 2016 (at this location): Please enter the number of employees (both full time and part time) that were employed by the company at this location on December 1, SECTION II PROGRAM ELIGIBILITY Business Status: Please indicate whether the business is a new or existing business by checking the appropriate box. New business: A start up business that began operations in the City and County of Denver in A replacement business facility is not considered a new business facility. Business new to the City and County of Denver: A business that began operations prior to 2016 outside of Denver and relocated to Denver or opened an additional facility in Denver in Existing business: A business established in Denver prior to January 1, Denver businesses established prior to 2016: Please mark all qualifying criteria for expansion business designation that you believe pertains to your application. WORKSHEET A JOB CREATION Please enter the number of full time and part time employees for each month of 2015 and This information will enable program staff to calculate the employee increase in 2016 over the preceding 12 month average. Please only include part time employees who work customarily at least 20 hours per week throughout the taxable year. Seasonal employees may be included in the applicable months if such persons perform their duties for substantially all of the season customary for the position in which such persons are employed. WORKSHEET B CAPITAL INVESTMENT The information provided in this section will help determine whether overall capital investment levels may qualify business for the business personal property tax credit. Note that real property and other property not taxed as business personal property are not eligible for the tax credit. REAL PROPERTY Real property is generally defined as real estate owned or leased by the business at this location. Please enter information for the business original facility as applicable, and the business expanded or new business facility, into the table provided in Worksheet B. Original business facility: A building or complex of buildings acquired, constructed or leased, and occupied by the business prior to Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 7 of 11

8 On site expansion: Expansion activities in 2016 at the original business facility, such as additions to the existing building(s), expansion of the space occupied, or other investments in the existing space. New business facility: A newly acquired or leased facility in 2016 Note: Lease renewals in 2016 are not applicable. The BPP tax credit is not available to a leased facility lessor. Build to suit facility: A newly constructed facility completed in Square footage: Gross square footage of purchased or leased building space; if entering information for an on site expansion, please list the original square footage occupied under original business facility and the newly added square footage under on site expansion. Property value: Original cost if owned or net annual rental rate if leased. Construction cost or General contractor estimate: The (added) value of on site expansions and buildto suit facilities may be established by the construction cost or General contractor estimate. Please include material and labor cost. BUSINESS PERSONAL PROPERTY (BPP) Business personal property refers to assets used in conducting a business. The chief characteristic distinguishing personal property from real property is mobility, meaning it can be moved from one place to another. Some examples include but are not limited to office equipment, communication equipment, tools, fixtures, machinery and equipment used in construction and manufacturing. As the personal property depreciates, its taxable value decreases each year. Please list all business personal property placed in service in 2016, including a brief description of the property, quantities, date acquired, original cost of equipment, installation cost for equipment by unit or system, and date placed into use. Please indicate for each item whether the property was acquired new or used, and whether it is a replacement for existing equipment. Replacement equipment does not qualify for the credit. Eligibility for the tax credit will be determined by compliance with Chapter 53, Article XVI, D.R.M.C. Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 8 of 11

9 Application for New Business and Expanded Business Personal Property Tax Credit For qualifying businesses personal property placed in service in 2016 Section I General Business Information Business name (legal name) and physical location Mailing address (if different from physical location) FEIN # BPP Schedule # NAICS # Primary products or services provided Business start date (at this location) Section II Program Eligibility Business Status (Please check the appropriate box only; see instructions for definitions) New business (start up) Business new to the City and County of Denver (due to relocation or expansion) Existing business (established in Denver prior to January 1, 2016) Did this facility relocate from another location? Yes No If yes, please provide the address of the former location: Denver businesses established prior to 2016 To be program eligible, one of the following qualifying criteria must be met in 2016 (please mark all criteria that you believe pertains to your application): $1 million investment in business expansion 100 percent investment increase above the existing business capital level (investment in expansion exceeds 100% of the investment in the original facility prior to expansion) 10 employee increase over preceding 12 month average 10 percent employment increase over preceding 12 month average Number of employees as of December 1, 2016 (at this location) All applicants are to complete Worksheet A & B as part of this application. The Office of Economic Development reserves the right to require additional information as needed to determine eligibility. I verify this information is to the best of my knowledge true, correct and complete. Errors or omissions may result in a delay or denial of this application. Signature of applicant (business owner or authorized agent)* Date Phone Print name of person signing Fax (required) Name of contact at business for application (if different from person signing application) Phone and of contact at business for application (if different from person signing application) *For electronically submitted applications, please type your initials in the signature box. Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 9 of 11

10 WORKSHEET A JOB CREATION January February March April May June July August September October November December Number of full time employees Number of part time employees (minimum 20 hr/wk per employee) WORKSHEET B CAPITAL INVESTMENT This information helps determine whether overall capital investment levels may qualify business for the business personal property tax credit. Note that real property and other property not taxed as business personal property are not eligible for the tax credit. Real Property Please enter information for the business original facility and the business expanded or new facility, as applicable. Ownership Square footage Building clear height Property value (original cost if owned or net annual rental rate if leased) Construction cost /General contractor estimate (include material & labor) Original business facility Owned Leased Purchase cost $ Annual rental rate per SF $ On site expansion New business facility Owned Leased Purchase cost $ Annual rental rate per SF $ Build to suit facility Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 10 of 11

11 Business personal property Please itemize all business personal property placed in service in Attach additional sheets if necessary. The Assessor s Office will determine which items are eligible for the business personal property tax credit. Description including model or capacity Qty Date acquired Check applicable box(es) Cost of equipment Installation cost Denver businesses established prior to 2016 that wish to qualify through the 100% investment increase above the existing business capital level: Date placed in service Please indicate the total original cost of all Business Personal Property placed in service by your business at this physical location prior to 2016: $ Existing Denver businesses: To view your assets online go to Under Related Links in the upper right hand corner of the page, click Business Personal Property Records and search for your account using your schedule number. When your schedule is retrieved, click View Asset Details and enter your FEIN # (Federal Employer Identification Number). Your asset detail and current total value will then populate. Application Package for New Business and Expanded Business Personal Property Tax Credit (09/16) Page 11 of 11

BUSINESS PERSONAL PROPERTY

BUSINESS PERSONAL PROPERTY CONTACT INFORMATION Mailing Address: PO Box 7015 Indianapolis, IN 46207-7015 Office Location: 200 East Washington Street, Suite 1360 Indianapolis, IN 46204-3308 PHONE: 317-327-4631 FAX: 317-327-4639 EMAIL: