Tennessee has long been considered a state with one of the most business friendly economic climates in the nation. Twice ranked as one of the five best states in the nation to locate a business by Site Selection magazine, Tennessee has the third lowest combined state and local tax burden for businesses in the country.  In 2006, Forbes magazine ranked Tennessee the 20th best state to locate a business and in 2007, Tennessee was rated 13th in the same ranking, the largest single improvement of any state in the nation.  Tennessee does not have an income tax on personal wages nor a state property tax.
 
Jobs Tax Credit

Tennessee allows “qualified business enterprises” a credit against their franchise and excise taxes based on their capital investment and the number of jobs created. The amount of the credit and the period of time during which it can be used varies according to the size of the investment.  A company investing $500,000 dollars and creating 25 new jobs can claim a $2,000 dollar credit against their F&E taxes over a period of 15 years.  If the company locates in an economically distressed county (see map, pages 7-8), the Jobs Tax Credit increases to $4,500 dollars per job with a 15 year carry-forward.  The company can qualify for a $4,500 Jobs Tax Credit if it invests $20 million dollars in capital and creates a minimum of 1,000 jobs in a federally designated empowerment zone.  Currently, Tennessee’s only federally designated empowerment zone is in Knoxville, Tenn.

The percentage of tax liability companies are able to offset ranges from 33.33% to 100% based on the number of jobs created, ranging from 1,000 to 5,000 or more.

Super Wal-Mart

Walgreens

Kentucky Fried Chicken/Long John Silvers

The Boutique 

Tractor Supply Company

Subway

Concierge Services, LLC

Feeney Cabinets