Your window to apply for these tax credits opens January 2, 2019 and closes January 23, 2019.
Does your company plan to hire more people or buy equipment in 2019?
Do you want to reduce the high tax burden you pay in California?
The Cal Competes tax credit is awarded to California companies that plan to expand in California.
Companies that win usually have these characteristics:
1) They Pay Well
The size of the credit is based on the size of the salaries you pay. Winning companies generally offer salaries more than $40,000 per year. The higher the average salaries are, the higher your tax credit will be if you win. Low salary employers can win, but only if they have other factors in their favor.
2) Manufacturers and Technology
Manufacturers and technology companies (especially tech manufacturers), who plan to expand, have an advantage over other companies. For example, if your company develops software, fabricates and/or assembles products, or produces food, you have an advantage that other companies don’t.
3) Economically Distressed Area
If you’re located in an economically depressed area (ie: Stockton, Imperial Valley, San Bernardino, Central San Joaquin Valley), you have an advantage over companies in more robust economic areas. Companies in economically depressed areas often pay employees less than $40K/year, but given the alternatives, the state can still view these as “good salaries.” DCI won a large tax credit for a company paying low wages because the company was in an economically distressed area.
4) Unique for California
Your company’s uniqueness improves the probability of your success. If your company’s competitors are outside the state or outside the nation, then its unique status in California will increase the odds of your receiving an award.
5) Don’t Ask for Too Much
Companies that ask for too much tax credit don’t get a “counter-offer.” They simply get refused. You also don’t want to ask for too little and leave money on the table – a common mistake for companies that do win. If this sounds like “The Price is Right,” then you’ve got the right idea.
6) Use a Pro
Over 90% of Cal Competes applicants are rejected and many of those rejected could have been awarded tax credit if they used a firm with expertise and success in winning large amounts of Cal Competes credits. If you are assigning this important project to someone with little or no previous success in it, you could be robbing yourself of the expertise your company requires to gain the largest tax award. The paperwork is confusing and the multiple deadlines are so rushed that you are more likely to forfeit some or all of the money that a Cal Competes expert could produce.
Look for experts who don’t charge by the hour, since this will leave you financially out-of-pocket and upside down if you are in the majority of companies that receive no tax credit.
With DCI, there is no risk, or lost money and time, because fees are strictly based on successfully getting awarded the credit.
7) Get the Timing Right
You cannot get the tax credit retroactively for expansion you’ve already paid for. You have to be awarded credit first and then all the hiring you do and the equipment and buildings you buy thereafter can count towards your credit if you win.
There are just a few windows in the year when you can apply. If you miss the January window you miss out on thousands of dollars in tax credit for every single employee you hire in January, February, etc. until the next window opens. Successfully gaining this credit requires timely, focused attention.
Don’t Miss the January Deadline! The window to apply opens January 2, 2019 and the window closes January 23, 2019. Contact DCI Solutions firstname.lastname@example.org or (888) 395-0809 to discuss how this and many other specialized tax credits could add millions to your cash flow and long-term corporate value.