Quality Jobs

 

 

NOTE: New eligibility requirements will become effective January 1, 2018, pursuant to S.B. 1416.  Please click here for further information.

 The primary goal of the Quality Jobs tax credit is to encourage business investment and the creation of high-quality employment opportunities in the state. Quality Jobs accomplishes this goal by providing tax credits to employers creating a minimum number of net new quality jobs and making a minimum capital investment in Arizona.

The Quality Jobs tax credit offers up to $9,000 of Arizona income or premium tax credits spread over a three-year period for each net new quality job ($3,000 per year). The program encourages continuous employment; therefore, the tax credit is equal to:

Years of Employment

Tax Credit Amount

First year:

$3,000 per net new qualified employment position created during the taxable year or partial year of employment.

Second year:

$3,000 per qualified employment position, employed for the second full taxable year of continuous employment.

Third year:

$3,000 per qualified employment position, employed for the third full taxable year of continuous employment.

If the allowable tax credit exceeds the income or premium tax liability, any unused amount may be carried forward for up to five consecutive taxable years.

The Quality Jobs tax credit is capped at 10,000 jobs being claimed each year by all participants. To view the amount of available cap, please download the Tax Credit Allocation Table.


ELIGIBLE APPLICANTS

Any company making the minimum capital investment in Arizona and creating the minimum net new quality jobs can apply. Eligibility qualifications are different for rural and metro areas and are described in the chart below.

Minimum Capital Investment
Minimum Number of Net New Jobs (QEP's) Added
Percent of County Median Wage
      For Metro Locations:      
$5,000,000 25 100%
$2,500,000 25 125%
$1,000,000 25 150%
$500,000 25 200%
      For Rural Locations:      
$1,000,000 5 100%
$500,000 5 125%
$100,000 5 150%

 

Metro Area – A location that is within the exterior boundaries of a city or town that has a population of 50,000 or more, and that is located in a county that has a population of 800,000 or more.
Rural Area – A location that is within the boundaries of tribal lands or a city or town with a population of less than 50,000, or a county with a population of less than 800,000.

 


APPLICATION PROCESS

Pre-Approval for Tax Credits

A taxpayer must apply for Pre-approval by submitting an electronic Request for Pre-Approval.  To access the current forms, please click here.  Tax year 2011 and 2012 forms are located below.

If the Request for Pre-Approval is qualified, Commerce will issue a written notification of pre-approval to the company that identifies the amount of tax credits being reserved for the taxpayer.

Applying for Tax Credits

A taxpayer must also submit an electronic Application for Quality Jobs Tax Credits to Commerce. To access the current forms, please click here.  Tax year 2011 and 2012 forms are located below.

If the applicant meets all eligibility requirements, Commerce will issue a Tax Credit Allocation Letter to the taxpayer identifying the credit the taxpayer may be able to claim with the Arizona Department of Revenue (Revenue) or the Arizona Department of Insurance (Insurance), as applicable.


General Information

 

Program Summary 2018

Program Guidelines 2018

 

An overview of noteworthy changes can be downloaded by clicking here.

County Median Wage

For more detailed information please see below or direct questions to the Program Manager.


LEGISLATIVE INFORMATION

The QJTC program is established under A.R.S. § 41-1525
Income tax credits -A.R.S. § 43-1074 or 43-1161
Premium tax credit - A.R.S. § 20-224.03
2014 Legislative Update:  House Bill 2272
2017 Legislative Update:  Senate Bill 1416