Business Incentives & Tax Credits

 

Construction-in-Process

With timely filing, unfinished facility improvements may be exempt from local property taxes. In an enterprise zone, most authorized businesses enjoy a somewhat broader tax abatement using another form.

 

Enterprise Zone

In exchange for locating or expanding in the enterprise zone, eligible (generally non-retail) businesses receive a total exemption from the property taxes usually assessed on new investments. The standard program grants a property tax abatement for three years, but it can be extended to five years.

 

Long-Term Rural Enterprise Zone

The long-term zone program offers a property tax abatement of 7-15 years, compared to the standard enterprise zone that offers 3-5 years. Any type of business activity is eligible, but these incentives depend on local approval and minimum levels for investment size, job creation and employee compensation.

 

Oregon Business Expansion Program

The Oregon Business Expansion Program is an incentive program available to existing companies expanding operations in Oregon or new businesses coming into the state. The program is a cash-based incentive (forgivable loan) equivalent to the estimated increased income tax revenue from the new hiring.

 

Oregon Investment Advantage

This program helps businesses start or locate in Oregon by proving a multi-year, income tax deduction on new business operations. This potentially eliminates state business tax liability during an 8-9 year period after operations begin.

 

Qualified Research Activities Credit

This credit is allowed for increases in qualified research expenses and basic research payments. It is permitted only for qualified research and primary research conducted in Oregon.

 

Small Manufacturing Business Expansion Program

As part of Oregon’s effort to support the growth of existing businesses, this program provides funding assistance in the form of forgivable loans related to expansion projects for small manufacturing businesses.

 

Strategic Investment Program (SIP)

The Strategic Investment Program exempts a portion of very large capital investments from property taxes for 15 years. The program is available statewide.

 

Working Family Child Care and Dependent Care Tax Credit

Oregon is among 20 states in the nation that offers a state tax credit for dependent care assistance provided to employees. Oregon’s tax credit permits an employer to offset 50% of its child care expenditures against its state tax liability. The credit allows an annual limit of $2,500 per employee.

 

Work Opportunity Tax Credit (WOTC)

The WOTC is a federal tax credit designed as an incentive for businesses to hire individuals that consistently face significant barriers to employment. Participating employers are compensated through a reduced federal income tax liability.

 

Video & Film Incentives

Oregon offers programs to induce film and video productions. Unlike other states, Oregon’s video and film incentives are cash-based as opposed to tax credits. This simplifies and speeds up the process. Incentives include a rebate of 20% of the production’s Oregon-based goods and services and an additional cash payment of up to 16.2% of wages paid to production personnel.

Renewable Energy Incentives & Tax Credits

Alternative Fuel: Vehicle Infrastructure Tax Credit

ORS 469B provides a tax credit for transportation projects including transit services, alternative fuel vehicle fleet, and alternative fuel vehicle infrastructure projects.  Alternative Fuel Vehicle Infrastructures include projects such as electric vehicle charging, blender pump, and compress natural gas systems.

 

Alternative Fuel: Vehicle Fleet Tax Credit

ORS 469B provides a tax credit for transportation projects including transit services, alternative fuel vehicle fleet, and alternative fuel vehicle infrastructure projects.  The Alternative Vehicle Fleet Credit applies to fleet projects that include the replacement of two or more existing fleet vehicles, with new or converted vehicles that use alternative fuels.

 

Biomass Producer or Collector Tax Credit

Oregon provides tax credits for the production, collection and transportation of biomass that is used for energy production. To be eligible for the credit, an applicant must be an agricultural producer or biomass collector and the biomass material must be sourced from within Oregon.

 

Rural Renewable Energy Development (RRED) Zone

The RRED Zone offers an incentive through a property tax abatement to encourage new investments that either harness wind, geothermal, solar, biomass or other unconventional forms of energy in Oregon to generate electricity. The program also promotes the production, distribution or storage of a wide variety of biofuels.

 

State Energy Loan Program

The purpose of the State Energy Loan Program is to promote energy conservation and renewable energy resource development. The program offers competitive fixed interest rate loans for projects that do the following: save energy, use recycled materials to create products, use alternative fuels, and product energy from renewable resources such as water, wind, geothermal, solar, biomass, waste materials or waste heat.