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Upper Manhattan Empowerment Zone Wage Tax Credit

 
- General Information
- Links
- Prerequisites
- Process Steps
- Additional Notes
- Contact Information
- Disclaimer
General information [back to top]  
Agency:
Housing and Urban Development, Department of (FEDERAL)
Description:
Empowerment Zones (EZs) were created by the Department of Housing and Urban Development (HUD) to encourage business growth and economic development in low-income communities. The Upper Manhattan area of the New York City Empowerment Zone is administered through UMEZ.

The Upper Manhattan Empowerment Zone Wage Tax Credit provides businesses with an incentive to hire individuals who both live and work in an Empowerment Zone. Employers can claim a federal tax credit of up to $3,000 for each full- or part-time employee who is an Empowerment Zone resident. The credit is based on 20% of the first $15,000 in wages earned by the qualifying employee, and is available through December 31, 2009.

The credit can be claimed if the business pays qualified zone wages to a qualified zone employee. A qualified zone employee is any employee who meets both the following tests:

1. The employee performs substantially all of his or her services for you within an empowerment zone and in your trade or business.
2. While performing those services, the employee’s main home is within that EZ.

Employers must verify their business location and employees address as being inside the Upper Manhattan EZ. This can be done using HUD’s Empowerment Zone address locator, available alongside a map of the zone, under Links to Additional Information, below.

Qualified zone wages are wages, subject to the Federal Unemployment Tax Act, paid for services performed by an employee while a qualified zone employee. This also includes any wages paid to train or educate qualified zone employees.

For additional detail on qualified employees and wages, consult Form 8844, Empowerment Zone and Renewal Community Credit.
Links [back to top]  
Prerequisites [back to top]  
1.  Business and all employees for which the credit will be claimed must be located within an Empowerment Zone.
2.  Employees must be qualified zone employees and be paid qualified zone wages, as defined above. For additional detail on these definitions, consult Form 8844 (under Links to Application Materials above).
 
Process Steps [back to top]  
Steps to Apply Online:
  • No online process available
    •  
    Steps to Apply Offline:
    1.  Complete Form 8844, Empowerment Zone and Renewal Community Employment Credit. Follow the detailed instructions included with the form. Form 8844 is available under Links to Application Materials above.
    2.  File Form 8844 with the business’s federal income tax return.
     
    Additional notes [back to top]  
    The following individuals are NOT qualified zone employees: individuals employed for less than 90 days; certain related taxpayers; certain related dependents; any owner with a 5% interest or greater; an individual employed at with a private or commercial golf club, country club, massage parlor, hot tub facility, suntan facility, racetrack (or any facility used for gambling), or store whose principal business is the sale of alcohol; an individual employed in a farming trade business if, at the close of the tax year, the sum of the assets of that farm (either leased or owned) exceed $500,000. For more detail on qualified zone employees, consult Form 8844, under Links to Application Materials above.
     
    Contact Information [back to top]  
    Upper Manhattan Empowerment Zone :
    290 Lenox Avenue, 3rd floor
    New York, NY 10027
    Phone: (212) 410-0030
    Website: http://www.umez.org/
    Disclaimer [back to top]  
    This page provides general information only. The information does not address all relevant regulatory requirements of City, State or Federal Agencies, nor does it address requirements with which the business must comply on an ongoing basis. It is the business owner's responsibility to meet all City, State and Federal requirements. Failure to comply with all applicable laws and regulations may result in fines or in the suspension and/or revocation of licenses or permits, or other penalties as allowed by law.

    Please note that this information is not legal advice; you can only obtain legal advice from a lawyer. For more information or assistance, please contact the issuing Agency, using the contact information above, or call 311 (or 212-NEW-YORK if outside of New York City).
     


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