Pikes Peak Enterprise Zone

El Paso County and Teller County are dedicated to helping local businesses and organizations thrive! Through the Pikes Peak Enterprise Zone, we are working to improve the local business climate; facilitate growth in the quantity and quality of employment opportunities; respond effectively to local business expansion opportunities and constraints; develop and sustain increased rates of business investment and job creation; foster strong partnerships with citizens, businesses and non-profits; and provide numerous additional opportunities through tax savings.

Colorado Enterprise Zone (EZ) State Income Tax Credit Webinar:

El Paso County Economic Development hosted an informative webinar discussing the benefits of the Colorado Enterprise Zone (EZ) State Income Tax Credit Program on Tuesday, August 24th, 2021. Please see the slide deck and recording from the webinar below.

Pikes Peak Enterprise Zone (EZ) Webinar Slides

Pikes Peak Enterprise Zone (EZ) Webinar Recording

Enterprise Zone Webinar Graphic

Enterprise Zone (EZ) State Income Tax Credits:

The Enterprise Zone Program is a state income tax credit incentive which encourages new and established businesses to locate and expand in economically distressed areas of the state. The following incentives can be earned by businesses located within the geographical boundaries of the Pikes Peak Enterprise Zone.

Investment Tax Credit:

Businesses making investments in qualified property and equipment used exclusively within the Enterprise Zone for at least one year, may earn a tax credit equal to 3% of the amount of the qualified investment. Excess credits may be carried forward up to fourteen (14) years and pre-certification is required.

Commercial Vehicle Investment Tax Credit:

Businesses that invest in commercial trucks, truck tractors, tractors, or semitrailers, and associated parts may earn a 1.5% Commercial Vehicle Investment Tax Credit. Commercial Vehicle Investment Tax Credit Pre-Certification Application

Job Training Tax Credit:

Businesses who carry out a qualified job training program for their employees may earn a Job Training Tax Credit for 12% of their eligible training investment. On-the-job training is not a qualified job training program. Excess credits may be carried forward for up to fourteen (14) years and pre-certification is required.

New Employee Tax Credit:

Businesses hiring new employees in an Enterprise Zone may earn a state income tax credit of $1,100 for each net new employee hired by the business. Excess credits may be carried forward for up to five (5) years and pre-certification is required.

Employer-Sponsored Health Insurance Tax Credit:

Businesses may qualify for a tax credit of $1,000 for each employee who is insured under a health insurance plan or program provided by the employer. Employers must contribute at least 50% of the total health insurance program cost in order to be eligible. This tax credit is unique in the fact that it is only available to businesses for the first two full income tax years the business is located and operating in the EZ. Excess credits may be carried forward for up to five (5) years and pre-certification is required.

Research and Development Tax Credit:

Businesses can earn a 3% tax credit for an increase in annual research and development expenses compared to what they spent the prior two years. This tax credit can be earned by taxpayers who make expenditures in research and experimental activities conducted in the EZ for the purpose of carrying out a trade or business. There is no limit on the number of years excess credits may be carried forward; pre-certification is required.

Vacant Building Rehabilitation Tax Credit:

Businesses may earn a 25% tax credit for eligible rehabilitation costs to rehabilitate commercial buildings in the EZ that are at least 20 years old, and that have been completely vacant for at least two years. Qualified expenditures include exterior, structural, mechanical, and electrical improvements. Excess credits may be carried forward five (5) years and pre-certification is required.

Contribution Tax Credit:

Enterprise Zone (EZ) Contribution Projects encourage community participation and public-private partnerships to revitalize EZs by supporting local economic improvements, resulting in job creation/retention and business expansion. Colorado taxpayers may earn a 25% state income tax credit by contributing to targeted efforts. Excess credits may be carried forward five (5) years. Learn more.

Sales and Use Tax Exemption:

Purchases of manufacturing machinery and machine tools, parts, and materials used in machinery and machine tools used in the Enterprise Zone are exempt from the 2.9% State and 1.23% County sales and use tax.

For businesses located within the Enterprise Zone, the statewide sales and use tax exemption for purchases of manufacturing equipment is expanded to include non-capitalized equipment, parts, and tools to repair machinery. Also, machinery and machine tools used directly in the mining process qualify for the tax exemption. To claim this tax credit, complete form DR 1191 or DR 1192 through the Colorado Department of Revenue.

Please refer to Colorado Department of Revenue’s Enterprise Zone Income Tax Credit Guide for additional tax credit information and eligibility requirements.

Pikes Peak EZ Economic Development Goals:

  • Support business opportunities – and increase the number of out-of-area visitors to EZ contribution projects – that promote the region’s heritage, unique cultures, scenic beauty, wildlife, arts, sporting activities, and other tourism opportunities.
  • Support and encourage increased employment opportunities by partnering with economic development focused agencies and businesses in marketing, recruitment, and training efforts, resulting in new or increased job opportunities within the EZ.
  • In partnership with community stakeholders, support the revitalization of existing business districts through rehabilitation and business expansion.
  • Support Workforce Housing Capital Campaigns and Homeless Housing and Employment Services Operations, promoting a variety of housing and job opportunities in the region, resulting in an increase of successful housing outcomes and job placements.

Enterprise Zone Annual Pre-Certification and Certification:

Pre-Certification:

Legislative changes to the Enterprise Zone Program became effective in 2012 that now require pre-certification to be completed annually. EZ pre-certification is quick and simple and will ensure that your business can earn and claim these valuable tax credits.

Please visit Colorado’s Office of Economic Development and International Trade’s Enterprise Zone page and click on the “Apply for a tax credit” button to begin the pre-certification process. An email acknowledging receipt and submission of the pre-certification will be sent back to the tax preparer listed, and an additional email will be sent either approving or denying that pre-certification – please retain that approval email in your tax records.

Please note that pre-certifications may be completed up to three months in advance of the business’ tax year start date. Please note that there is no ability to pre-date a pre-certification application; the business’ eligibility to earn and claim EZ credits is from the point of approved pre-certification or the start of the income tax year, whichever is later, through the end of the business’ income tax year.

Certification:

Certification applications are to be completed following the conclusion of the tax year, prior to submitting your tax return to Colorado Department of Revenue. In order to certify for EZ tax credits, you must have an approved Pre‐Certification.

Pikes Peak Enterprise Zone Maps

Detailed maps of the Pikes Peak Enterprise Zone boundaries can be found below. To confirm whether your business is located in the Enterprise Zone geographical boundaries, please contact Sara Lobato or visit the State’s website and enter the business address in the Interactive Enterprise Zone Map.

Contact us:

Sara Lobato
Pikes Peak Enterprise Zone Administrator
9 E. Vermijo Ave.
Colorado Springs, CO 80903
Phone: 719-520-6480
saralobato@elpasoco.com