Business Incentives

Whether growing from within or recruiting targeted industry firms, Utah’s economy continues to lead the nation with its business-friendly environment.

The office’s Business Incentives team recommends financial incentives for local and out-of-state companies seeking to expand or relocate to Utah. The Economic Opportunity Board votes on all proposed incentives in a public meeting. The office’s executive director provides the final sign-off on all awarded incentives.

Incentives are available to select companies creating new, high-paying jobs that improve quality of life, increase the tax base, and help diversify state and local economies.

Incentives are offered as tax credits or grants. They’re disbursed only after the company has met contractual performance benchmarks, including job creation, capital expenditure, and payment of new state taxes.

Since its 2005 inception, approximately two-thirds of the companies participating in the state’s tax credit incentive program are Utah-based companies.

The state Legislature created Utah’s incentives program. It’s called an Economic Development Tax Increment Finance (EDTIF) tax credit. The statute that governs Utah’s economic development incentives is titled U.C.A. 63N-2-106(2) and is available here.

About EDTIF

Utah Counties Map - EDTIF

The Utah Legislature created the Economic Development Tax Increment Finance (EDTIF) corporate incentive program in 2005. As the state’s needs and economy continue to evolve, the Legislature fine-tunes the EDTIF program to maintain Utah's robust environment for economic development.

New guidelines from the 2022 legislative session focus on creating jobs throughout Utah while recognizing the unique challenges in the state's urban and rural areas.

Urban Counties

The EDTIF program is available for companies expanding in targeted industries in urban counties. These targeted industries include:

Advanced Manufacturing
Aerospace and Defense
Financial Services
Life Sciences and Healthcare
Software and Information Technology

Rural Counties

The office may authorize additional, non-retail projects outside of these targeted industries in rural communities.

Additionally, with the rural modifications to the EDTIF program, known as REDTIF, projects within rural Utah qualify for more significant incentive amounts.

Project Evaluation

The office will evaluate projects applying for the EDTIF program, in urban and rural areas, on the following criteria:

The average wage of planned new jobs
Capital expenditure investment
Type and number of new jobs created
Whether or not the jobs are related to headquarters or innovation operations
The company’s corporate citizenry efforts

The table below outlines how the EDTIF program applies in different areas of Utah.

	Urban	Rural	Most Rural
Requirements
	Project located in Salt Lake, Davis, Utah, Washington, or Weber counties	Project located in Box Elder, Cache, Iron, Summit, or Tooele counties	Project located in all other counties
	Project must be in one of five strategic targeted industries	Targeted industry preferred but not required	Targeted industry preferred but not required
	New jobs created must pay at least 110% of the average county wage	New jobs created must pay at least 100% of the average county wage	New jobs created must pay at least 100% of the average county wage
Percentage of new state tax revenue from the project that may be given in a post-performance tax credit	Up to 30%	Up to 30% in most cases and up to 50% for very large projects	50% for all qualifying projects

*For the EDTIF program, incorporated towns within these counties that have fewer than 10,000 residents are considered rural.

They Chose Utah

Use our incentives dashboard to view participating companies by name, year, and more.

INCENTED COMPANIES

Tax Credits & Other Programs

The EDTIF tax credit is a post-performance, refundable tax credit for up to 30% of new state revenues (sales, corporate, and withholding taxes paid to the state) over the life of the project (typically 5-10 years). The incentive is available to Utah companies and others seeking to relocate or expand operations to Utah.

Policy:

Maximum credit of up to 30% over the life of the project
No more than 50% credit in any one year
The life of the incentive is typically five to 10 years
New jobs created must pay at least 110% of the county average wage within both rural and urban communities and be within a specifically targeted industry
No retail business operations
The new project must compete with other locations
The office does not consider projects for businesses operating for less than three years that cannot show consistent profitability

Requirements:

Create new high-paying jobs in the state
- At least 50 jobs in urban counties
- At least 110% of the county average wage
Generate new tax revenues
Significant capital investment
Significant purchases from Utah vendors or suppliers
Obtain commitment from local government to provide local incentives and establish an
Economic Development Zone
Enter into an incentive agreement with the Governor’s Office of Economic Opportunity, which specifies performance milestones

Downloads:

Wage criteria for 2021 incentives
Wage criteria for 2020 incentives

The IAA is a post-performance grant for the creation of high-paying Utah jobs.

Requirements:

Create new high-paying Utah jobs
- At least 50 jobs in urban counties
- At least 110% of urban county average wage or 110% of rural county average wage
Obtain commitment from local government to provide local incentives
Demonstrate company stability and profitability
Demonstrate competition with other locations
Enter into an incentive agreement with the Governor’s Office of Economic Opportunity, which specifies performance milestones

Downloads:

In 2014, the Utah Legislature enacted the Utah Small Business Jobs Act to attract additional investment in the most severely distressed areas of the state.

New Market Tax Credit programs are an effective tool used by the federal government and 13 states, including Utah, to attract private capital investment in areas in need of job growth and economic opportunities.

To learn more, please contact us.

During the 2016 general session, the Utah Legislature changed the Technology and Life Science Economic Development Act, giving the Governor’s Office of Economic Opportunity authority to issue tax credits to qualifying technology and life science investors.

Eligible investors may submit applications for tax credits drawn from $300,000 of funds expressly set aside by the Legislature.

Investment:

Post-performance non-refundable tax credit for up to 35% of the investment over three years
Up to 10% of the purchase price of the qualifying ownership interest in the year the qualifying ownership interest is purchased
Up to 10% of the purchase price in the second year after the qualifying ownership interest is purchased
Up to 15% in the third year after the qualifying ownership interest is purchased
Tax credits for Utah life science entities capitalized under $2,500,000
An investor must invest at least $25,000 and not have more than a 30% ownership interest in the business entity at the time of investment
The investment may not be finalized before application and formal approval of the tax credit
No credit may exceed $350,000 in any year
Not permitted to carry forward or backward

Application Deadlines:

September 1
December 1
March 1
June 1

Investment Tax Credit Application

Technology and Life Science Tax Credit Rules

The Housing and Transit Reinvestment Zone Act (S.B. 217) requires a municipality or public transit county to submit a Housing and Transit Reinvestment Zone proposal to the Governor’s Office of Economic Opportunity.

The office will initiate an analysis of the feasibility, efficiency, rate of return, and other aspects of the proposed Housing and Transit Reinvestment Zone.

Municipalities or public transit counties approved for the Reinvestment Zone receive certain tax advantages based on their proposal’s merits.

Interested municipalities or public transit counties should contact the office for additional information. To submit an application and proposal, contact the office to request access to the HTRZ application portal at htrz@utah.gov.

Resources

NDA & GRAMA Request Form

Recent Tax Credit Announcements

Check out recent announcements of companies utilizing Utah's EDTIF economic opportunity tax credit.