FRANKFORT, Ky. (June 13, 2016) – Having used the Kentucky Small Business Tax Credit program in 2012, Lesli Riehemann, president of Mach III Clutch Inc. in Walton, Ky., knew her two new hires and investment in a CNC machine would qualify the company a second time.
So when her second hire came on board, she set a calendar notification for exactly one year out.
“It’s a great way to get a return on your investment in new employees and equipment. Sometimes you make that investment and it takes years to see that come to fruition. With this program, you receive a credit the next tax filing season,” she said.
Like Mach III Clutch, companies across the state continue to create jobs and invest in equipment and technology with assistance from the Kentucky Small Businesses Tax Credit (KSBTC) program. KSBTC is currently available through the Kentucky Cabinet for Economic Development’s Office of Entrepreneurship.
Last year, KSBTC assisted in the creation of a record 364 private-sector jobs and $3.63 million in investments by 140 small businesses. On average, each participating company hired 2.6 people and received $8,856 in tax savings.
“Small businesses are a cornerstone of Kentucky’s employment. Their growth and success is crucial to the Commonwealth’s economy overall,” said Erik Dunnigan, the cabinet’s acting secretary.
“This program ultimately reduces the costs for companies to do business in Kentucky. By putting revenue back into small businesses for their hiring and investments, the program improves cash flow and puts them in better positions to compete and succeed. I encourage Kentucky’s small-business owners to apply now and take advantage of this opportunity.”
To qualify for tax credits between $3,500 and $25,000 per year, a small business must employ 50 or fewer people full-time. Businesses must have created and maintained at least one full-time job at $10.88 per hour or more for at least 12 months and purchased $5,000 or more in qualifying equipment within the last 24 months. The tax credit amount varies based on the number of jobs created and the amount invested in equipment.
For-profit companies in various industries including retail, service, construction, manufacturing and wholesale, can apply.
In May, Mach III Clutch received approval for its second tax credit. The company designs and manufactures clutches, brakes and mechanical torque limiters used in label printing presses, commercial laundry equipment, aerospace assembly, food packaging and other industries. Mach III currently employs 13 people including one part-time worker.
Since inception, KSBTC has assisted in the creation of 630 jobs and $6.7 million in new investments.
KSBTC is one of multiple programs the Cabinet’s Office of Entrepreneurship operates to encourage growth among the state’s startups and small businesses. Program guidelines and application forms are available at www.KentuckyTaxCredit.org or by calling the Office of Entrepreneurship at 800-626-2250.
Other Office of Entrepreneurship resources include programs providing assistance for international trade and market development, access to credit, mentoring and advocacy. As well, through its Kentucky Innovation Network, entrepreneurs and startups can connect with multiple resources at offices statewide. Learn more about the Office of Entrepreneurship here.
The Kentucky Cabinet for Economic Development is the primary state agency responsible for encouraging new jobs and investment in the state. New capital investment announced in Kentucky in 2015 totaled a state record $5.1 billion, spurring more than 16,000 projected new jobs. Information on available industrial properties, workforce development assistance, incentive programs, community profiles, small business development and other economic development resources is available at www.ThinkKentucky.com.