Lancaster City Keystone Innovation Zone (KIZ)

Lancaster City Alliance is the agency designated by the Pennsylvania Department of Community & Economic Development to coordinate the Keystone Innovation Zone (KIZ) Program in the city of Lancaster, providing tax credits of up to $100,000 annually for qualified innovative businesses in a defined geographic area of the City.

Overview

The KIZ Program, established by Act 12 (SB 778) of 2004, creates designated geographic zones to foster innovation and create entrepreneurial opportunities by aligning the combined resources of educational institutions and the private sector. With a total pool of up to $15 million in tax credits available to KIZ companies annually, the KIZ Tax Credit Program significantly contributes to the ability of young KIZ companies to transition through the stages of growth. KIZ Tax Credits can be used to offset certain state tax liabilities. This innovative program also contains a tradability component crucial to young companies that have little or no tax liability.

Eligibility

To be eligible to participate in the KIZ Tax Credit Program, the applicant must meet the following criteria:

Must be an entity subject to Personal Income Tax (Article III) or Corporate Net Income Tax (Article IV)
Must be a for-profit business entity located within the geographic boundaries of a particular KIZ
Must be in operation less than 8 years
Must be operating within one of the KIZ target industry sectors:
- Advanced Materials / Diversified Manufacturing
- Business Services
- Life Sciences
- High Technology
The applicant, shareholders, members and partners of the applicant, must be in state tax compliance as determined by the Department of Revenue. a. State Tax Compliance requires the applicant, shareholders, members and partners of the applicant to have filed all required state tax reports and returns for all applicable taxable years and paid any balance of state tax due as determined at settlement or assessment by the Department of Revenue, unless the tax due is under appeal at the time the finding was made by the Department of Revenue. Additionally, as part of the application, the applicant must file a State Tax Clearance Form with the Department of Revenue for the applicant and for any shareholder, member or partner owning 20% or more of the applicant entity. (See Section E below)
Meet any other requirements specified by the Department of Community & Economic Development 2 Keystone Innovation Zone (KIZ) Tax Credit Program Guidelines 09/20/2021 Additionally, eligible KIZ companies must contact and be working with their local KIZ Coordinator. KIZ Coordinators are required to provide each eligible company with a Coordinator Certificate, which must be included on the tax credit application. If a company is not working with its KIZ Coordinator and cannot obtain a KIZ Coordinator Certificate for its application, then it is ineligible to receive tax credits.

To learn more about the program, please review the Official KIZ Program Guidelines (2021) and contact Jeremy Young, Director of Community & Economic Development, at jyoung@teamlanc.org or 717.696.6200.

For Additional Information, Please Visit:

Official Pennsylvania Keystone Innovation Zone Tax Credit Program Website

Lancaster City Keystone Innovation Zone (KIZ)

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