Tax Incentives

1. Tax Incentives

2. What are tax incentives? Tax incentives are ways of reducing taxes for businesses and individuals in exchange for specific desirable actions or investments.

3. Tax incentives generally take one of three forms: • Tax deductions. • Tax credits. • Tax reduction or forgiveness.

4. What do we mean by using tax incentives to support community health and development? • Tax incentives can be used to persuade businesses and individuals to take positive action and leads to the achievement of community goals and the betterment of the community. • Tax incentives can sometimes be used to persuade businesses or individuals not to take action that would create barriers to community goals and to the betterment of the community.

5. Why use tax incentives to support community health and development? • Tax incentives speak to businesses’ and individuals’ self-interest. • Tax incentives make allies rather than adversaries. • Tax incentives can show businesses that community-building projects can be both feasible and profitable, thus leading to more of them. • Tax incentives can be an efficient use of taxpayer money. • Tax incentives can be directed exactly where they’re needed.

6. When would you use tax incentives? • When you’re trying to manage growth. • When you’re revitalizing neighborhoods, communities, and rural areas. • When you’re trying to meet community needs. • When you’re trying to prevent or fix environmental problems. • When tax incentives can be part of a coordinated strategy.

7. Who should use tax incentives to support community health and development? Policy makers and legislators should apply tax incentives.

8. Supporting and advocating for tax incentives should be the work of: • Direct beneficiaries of tax incentives. • Human service providers and advocates for the poor. • Economic developers and community planners. • Businesses, corporations, real estate developers, etc. • Environmental activists. • Farmers. • Local officials, especially those in economically depressed areas, or areas with other problems that might be addressed through incentives.

9. How do you use tax incentives to support community health and development? You can apply tax incentives to: • Affordable housing. • Neighborhood development. • Historic preservation. • Enterprise zones. • Health. • ADA compliance. • Charitable contributions.

10. You can apply tax incentives to (cont.): • Environmental responsibility: • Open space preservation. • Brownfields reclamation. • water conservation. • Green building. • Waste management and pollution control. • Sustainable agriculture. • Farmland/open space/wildlife habitat preservation. • Residential, commercial, industrial development site selection and preparation.

11. You can apply tax incentives to (cont.): • Energy conservation • Recycling. • On-site power generation. • Resource conservation. • The purchase of alternate fuel or hybrid vehicles. • The development and/or use of renewable energy and sustainable technology.

12. You can apply tax incentives to (cont.): • Employment and workforce development • Job creation. • Job training. • Workplace education. • Workforce development. • Hiring people from disadvantaged groups.

13. You can convince policy makers to put incentives in place by: • Advocating with legislators and policy makers. • Using the media to get public opinion on your side. • Keeping at it for as long as incentives are needed and useful.