Incentives & Taxes
Extend Your Investment
Amplify your growth with tax and training, funding, and business incentives in Colorado Springs. Business personal property taxes are not collected by the city or the county. Some incentives are designed for small business and specific sectors, including the aerospace industry and the manufacturing industry. Start, relocate or expand with a development professional who guides you through the process. Reduce costs and leverage the perks of doing business in Colorado Springs.
Local Incentives
The following is an overview. Contact a member of our economic development team to discuss options specific to your plans.
Personal Property Tax Credits
The State of Colorado assesses a business personal property tax on personal property assets of a business or organization. As an incentive, the City of Colorado Springs and El Paso County do not collected the tax. El Paso County is the only county in the state to forego collection of the business personal property tax.
Sales Tax Exemptions
Each business is individually evaluated to determine tax advantages. Standard incentives apply to construction materials, business personal property, and large purchases of manufacturing equipment.
Private Activity Bonds
City of Colorado Springs Private Activity Bonds provide significant savings over traditional lending and are exempt from federal and state income tax. Qualified projects include new or rehabilitated facilities, new equipment, facilities infrastructure, and other initiatives.
Pikes Peak Enterprise Zone
Tax credits are available to businesses operating in the Pikes Peak Enterprise Zone.
- Investment: 3% Colorado income tax credit for investments in equipment used in the zone for at least one year.
- Job Growth: $1,100 Colorado income tax credit for each new job created above the maximum number employed in the prior tax year.
- Employer-Sponsored Health Insurance: Two-year credit of $1,000 ($2,000 total) for each employee insured under an employer-sponsored health insurance program.
- Research & Development: 3% of R&D expenditures above and beyond the average of the last two years’ R&D expenditures.
- Rehabilitation of Vacant Buildings: 25% credit or rehabilitation costs (up to $50,000) to update buildings at least 20 years old and vacant for two years.
- Job Training: 12% credit of the training investment in a job training program conducted on site or off site to improve employee skills.
- Manufacturing and Mining Equipment: State and county sales tax exemptions for purchases of manufacturing machinery or machine tools and parts.
Commercial Aeronautical Zone
Aeronautical businesses can realize significant incentives within the Commercial Aeronautical Zone at the Colorado Springs Airport. All local sales and use taxes, with some exemptions, are abated for companies operating within the zone.
Small Business
The Pikes Peak Regional Development Corp. offers advantageous financing through SBA 504 loans and the El Paso County Revolving Loan Fund. Depending on the program, businesses can typically secure up to 40% of project costs, with additional incentives for manufacturers.
Energy and Water Agreements
Exclusive contractual agreements may be created for commercial customers of Colorado Springs Utilities. Municipally owned, the four-service enterprise offers some of the lowest energy and water rates in the nation, with a 99.9% electric reliability rate.
Rapid Response Team
The Colorado Springs Rapid Response Team is made up of business development experts from agencies across the region. Planning and construction reviews, permitting, and approvals are coordinated to expedite your new business, expansion, or relocation.
State Incentives
Search all state incentives offered through the Colorado Office of Economic Development and International Trade.
Strategic Fund Incentive
Through the Colorado Strategic Fund, businesses earn cash by creating and maintaining permanent net new jobs. The incentive is based on the average wage rate of new jobs and requires a local matching commitment.
Job Growth Incentive Tax Credit Program
State income tax credits for job creation are available to businesses considering states other than Colorado. At least 20 net new full-time equivalent jobs must be sustained for 96 consecutive months and annual wage requirements must be met.
Colorado Sales & Use Tax Exemption on Aircraft and Aircraft Parts
Aircraft used in interstate commerce by a commercial airline and parts permanently affixed to aircraft are exempt from state sales and use tax. Included are fuselage parts, parts for aircraft engines, seats permanently affixed to the aircraft, aircraft paint, and other materials.
Aviation Development Zone Tax Credit
The Colorado Springs Airport is a state-recognized Aviation Development Zone. Businesses within this zone, and involved in aircraft manufacturing or maintenance, may qualify for a state income tax credit of $1,200 per net new full-time employee.
Biotechnology Sales & Use Tax Refund
Qualified businesses may seek an annual refund for Colorado sales and use taxes paid on purchases of tangible personal property. Qualifying property is used directly and predominately in research and development of biotechnology.
Foreign Trade Zone
Enhance your position in the international marketplace. The Colorado Springs Foreign Trade Zone (#112) is comprised of 2,300-plus acres in four separate areas of the city.
Foreign Trade Zones are restricted-access areas within the U.S. and Puerto Rico that are recognized as legally outside the customs territory. Key benefits include:
- Duty deferral
- Duty reduction
- Duty avoidance for the transfer, use, and storage of imported materials
Located within the Colorado Springs Foreign Trade Zone at the Colorado Springs Airport is the Peak Innovation Park. The 900-acre site is home to office, flex, warehouse/distribution, and retail space. The Peak Innovation Park offers customized land sites from one acre, with build-to-suit, sale, or lease availability starting at 10,000 square feet.
Training Incentives
The following is an overview. Contact a member of our economic development team to discuss options specific to your plans.
Pikes Peak Workforce Center
Companies moving to Colorado Springs may be eligible for training dollars to hire and train new, local employees.
- On-the-Job Training: Partially reimburses employer wages for hiring a candidate that needs additional skills for the open position.
- Employee Development Grants: Provides training to upskill current employees to increase the competitiveness of the employee and the employer. Participants acquire skills required to move to a higher-skilled and higher-paid job within the company, thus permitting the company to hire a job seeker to backfill the incumbent’s pre-training position.
The Pikes Peak Workforce Center offers a range of employer services, including hiring events, job fairs, pre-employment assessments, jobs postings, and transition resources.
Corporate Tax
| State | Corporate Tax Rate |
|---|---|
| Nevada | N/A |
| Washington | N/A |
| Illinois | 9.50% |
| California | 8.84% |
| District of Columbia | 8.25% |
| Massachusetts | 8.00% |
| Oregon | 7.60% |
| Idaho | 6.925% |
| New Mexico | 5.90% |
| Utah | 4.95% |
| Arizona | 4.90% |
| COLORADO | 4.63% |
| North Carolina | 2.50% |
| Texas | .75% Franchise Tax on $1,110,000+ Revenues |
