Glossary of Terms

  • Empowerment Zone — Highly distressed urban and rural communities designated by the Department of Housing and Urban Development (HUD) and the Department of Agriculture (USDA) that are eligible for grants, tax credits, bonding authority and other incentives.
  • Enterprise Zone — Economically distressed areas designated by the California Department of Housing and Community Development (HCD) to stimulate business investment and job creation for qualified disadvantaged individuals.
  • Federal Tax Incentive — A tax incentive offered by the federal government.
  • Franchise Tax Board (FTB) — The California state agency responsible for administering the personal and corporate income tax.
  • Hiring Credit — A tax credit offered under the California Enterprise Zone program. Businesses may generate more than $37,000 in California tax credits per qualifying employee.
  • Hiring Incentives to Restore Employment (HIRE) Act — The HIRE Act was signed into law to promote hiring and encourage business investment and includes provisions for an exemption from the employer’s Social Security tax contribution as well as an employee retention credit.
  • Internal Revenue Service (IRS) — The federal agency responsible for tax collection and tax law enforcement.
  • Local Agency Military Base Recovery Area (LAMBRA) — Promotes economic development and employment opportunities in designated military base areas by offering tax incentives similar to the California Enterprise Zone program.
  • Net Interest Deduction — A tax incentive offered under the California Enterprise Zone program that offers lenders a tax deduction on loans made to Enterprise Zone businesses. The lender itself is not required to be located in an Enterprise Zone.
  • Renewal Community — Highly distressed urban and rural communities designated by the Department of Housing and Urban Development (HUD) and the Department of Agriculture (USDA) that are eligible for grants, tax credits, bonding authority and other incentives.
  • Research and Development (R&D) Tax Credit — A non-refundable tax credit offered by the federal government and most states to incentivize companies to improve products and processes.
  • Sales or Use Tax Credit — A tax credit offered under the California Enterprise Zone program. Businesses may receive a credit in the amount of the sales or use tax paid on qualifying property placed in service within an Enterprise Zone.
  • State Tax Incentive — A tax incentive offered by a state government.
  • Targeted Employment Area (TEA) — A residential area within a California Enterprise Zone that is specially targeted for increased employment. Enterprise Zone businesses hiring workers who live in a TEA qualify for substantial tax savings.
  • Targeted Tax Area — A targeted area encompassing Tulare County and previously designated by the California Technology, Trade and Commerce Agency to stimulate growth and development. The California Technology, Trade and Commerce Agency was eliminated 1/1/2004 and replaced with the California Department of Housing and Community Development.
  • Tax Credit — A direct reduction in tax liability.
  • Tax Deduction — A reduction in the gross amount on which a tax is calculated.
  • Tax Incentive — A deduction, exclusion, or exemption from a tax liability offered as an enticement to engage in a specified activity for a certain period.
  •  Work Opportunity Tax Credit (WOTC) — A federal tax credit offered to employers that hire individuals from the program’s targeted groups. The maximum credit is $9,000 per qualifying employee.