Empowerment Zone and Renewal Community Employment Credits
The Empowerment Zone Employment Credit and Renewal Community Employment Credit were established in 1993 to provide businesses with an incentive to hire individuals who both live and work in one of these targeted areas.

Businesses located in one of these areas can claim a tax credit of up to $3,000 a year for each employee who lives in an Empowerment Zone, or up to $1,500 for each employee who lives in a Renewal Community. Unlike WOTC, the Empowerment Zone and Renewal Community Credits can be claimed each year an individual is employed.

The Empowerment Zone Credit is a 20% credit on the first $15,000 of wages per eligible employee each year for a maximum annual credit per employee of $3,000. The Renewal Community Credit is a 15% credit on the first $10,000 of wages per eligible employee each year for a maximum annual credit per employee of $1,500.

To qualify for an Empowerment Zone or Renewal Community Credit, an individual does not need to work a minimum number of hours, but instead, they must be employed for at least 90 calendar days.

Employees certified for WOTC can still qualify for the Empowerment Zone and Renewal Community Credits, but WOTC will reduce the maximum wages for each of these credits by the amount of wages that are used to calculate their WOTC credit.

Empowerment Zone and Renewal Community Program Requirements
New employees, current employees, and former employees (depending on your company’s tax situation and if you elect to amend any previously filed tax returns) are eligible for Empowerment Zone and Renewal Community Employment Credits.

Employees do not have to complete any paperwork for these credits.

Just as with WOTC, SimTax does 99% of the work when it comes to obtaining the Empowerment Zone and Renewal Community Employment Credits.