B & O Tax Incentive Program
The City of Clarksburg has a new B and O Tax Incentive Ordinance that can save new, expanding, and annexed businesses tax money for up to three years.
How It Works
To be eligible for the tax credit, a business must open after July 18, 1996 in selected areas of the City, and expand or annex an existing business anywhere in Clarksburg after the same date. New businesses, if qualified, will receive a B and O Tax credit for a percentage of the upcoming three years gross receipts according to Table 1. Expanding businesses, if qualified, will receive the listed percentage of the incremental difference between gross receipts of the year prior to, and the three years following the business expansion.
For instance, a business making $10,000 per year in the Central Business District expands, and applies for the City's tax credit program. The business then makes $50,000 per year for the next three years. For the first year after expansion, the business would only have to pay B and O Tax on $10,000 (100% credit on the difference between year before expansion and first year after expansion). The second year's B and O Tax would be on $20,000 (75% credit on the difference between year before expansion and second year after expansion), and B and O Tax in the third year would be on $30,000 (50% credit on the difference between year prior to expansion and third year after expansion).
Some new and all expanding businesses need to meet minimum qualified investment amounts to be eligible for the credit. Different areas of the City will provide different tax credits over three years, and need different levels of investment to receive the tax credits.
Qualified Investment Needed For New Businesses
As seen in Table 1, new businesses in the Central Business District (CBD), Glen Elk Number 1, Glen Elk Number 2, and the Montpelier Addition do not need to meet a minimum qualified investment amount.
New businesses locating in the Business and Technology Center and Industrial (I-2) areas will need to invest a minimum of $225,000 and create a minimum number of jobs. Fifteen jobs for businesses in the Business and Technology Center and five jobs for businesses in I-2 industrial areas.
Qualified Investment Needed For Expanding Businesses
- Business expansion can consist of increasing inventory, purchasing real property to enlarge, or renovating and modernizing business property (all except exteriors).
- The amount of qualified investment needed to receive the tax incentive is different for different areas of the City.
- In the Central Business District, Glen Elk Number 1, and Montpelier Addition the qualified investment needed is at least $10,000.
- In Glen Elk Number 2 an investment of at least $100,000 and the creation of five new jobs is needed.
- Businesses in the Business and Technology Center must expand by creating ten additional full-time jobs to be eligible for the credit.
- Businesses in the rest of the city can take advantage of this tax incentive program by making an investment of at least $100,000 toward business expansion.
Maximum Tax Credit
New and expanding businesses in the CBD, Glen Elk Number 1, Glen Elk Number 2, and Montpelier areas of the City will be able to get B and O Tax credits for up to a maximum of $50,000 over the three year program.
New and expanding businesses locating in the Business and Technology Center will be able to get $100,000 in tax credits over the three year program. Also, any expanding business in the Clarksburg City limits (outside of the above highlighted areas), that qualifies for the tax credit, will get up to a maximum of $100,000 over the three year program. Annexed businesses can receive a maximum of $100,000 in tax credits over the upcoming three year period.
Fire / Flood Damage
A special one year, one time tax credit is offered to businesses damaged by fire or flood where the damage is greater than 50% of the fair market value of the real and personal property of the business. If the business elects to reopen, the credit is equal to 50% of the B and O Taxes owed for each quarter in the first year after the business is reopened.
No application for a tax credit will be considered and no credit will be otherwise granted to any business who, at the time the application is submitted, is delinquent in the payment of City Business and Occupation Taxes. Home-based businesses, financial institutions, public utilities, the local cable company, and owners of residential rental property, including multi-family apartment units, are excluded from this credit program.