Deloitte. DBriefs U At a glance 09/10/09

Business Tax Credits — Carrot or Stick?

Description

Agenda

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Governments often use tax credits as policy tools to influence business and public behavior. How can businesses, governments, and the public benefit from credits? We'll discuss:

• A historical perspective on tax credits and how they steer issues such as job creation, energy usage, and the environment.
• Distinctions between tax credits and discretionary incentives - their intent, application, and benefits.
• State audit and defense issues that impact the life expectancy of credits and the calculation of their worth.

Learn about this niche area of the tax profession and how current lawmakers may leverage tax credits to reshape public policy and business decisions.
58 minutes

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• Introduction - Tax and public policy
• Example - Energy tax credits ("going green")
• Types of credits
• Credit mechanics
• Case study - policy meets financial innovation
• Career opportunities

Supplemental Material

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Discussion/Quiz Questions

1. Why are business tax credits growing in popularity in today's business environment?

2. What general utilization limitations exist once the amount of the applicable credit for any taxable year has been determined?

3. Identify 3 applicable federal or state tax credits under the following categories: (1) Location, (2) Eligible Investment, and (3) Workforce/job creation. Describe generally how the tax credit is determined and the public policy objective for each incentive.

Learning Activity

Case Study: Case Study: Business Expansion
Presented with a set of facts about a company that expanded its manufacturing facility, the student will identify and compute applicable credits and incentives available for the business expansion, and evaluate the company's alternatives for utilizing the various incentives. 40-60 minutes