After consulting with small businesses, new tax credit could pass

If businesses leave Illinois, revenue for the state and local economies disappears along with the jobs that a business supported. After consulting with small businesses, a bill is working its way through the state legislature to provide a tax credit to companies that remain in the state. The bill has already passed in the House and is on its way to the Senate.

The bill focuses on companies with 100 employees or less. The new legislation actually modifies Illinois' tax credit program called EDGE. If a qualifying company creates positions to employ at least five people in lower-income areas, the requirement for an investment of $1 million in new capital goes away.

On the other hand, it will require companies that have never applied for the credit to provide the state with certain tax information. Those who support this change believe it will curtail businesses from asking lawmakers to provide them with special dispensations while keeping them in the state. Those who oppose the bill believe a better solution would be to simply lower the income tax rate for corporations in the state.

When deciding where to start a business, a myriad of issues need consideration. Taxes are one of the biggest items for which many entrepreneurs are consulting with professionals and lawmakers. The location of a company is at least as important as how the company will be structured -- especially when it comes to the tax ramifications. Seeking out the advice and assistance of someone familiar with these issues could have a lasting effect on the success of any new venture.

Source: ksdk.com, "Illinois House OKs small business tax credit proposal", , May 30, 2014

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