What is the Empowerment Zone (EZ) Tax Credit?

The Empowerment Zone (EZ) Tax Credit is a federal incentive aimed at stimulating economic growth and job creation in designated urban and rural areas across the United States. It forms a cornerstone of the government's efforts to revitalize communities by offering tax advantages to businesses that choose to invest and create jobs within these zones. Businesses of all sizes that employ local talent may be eligible for this program.

The Empowerment Zone (EZ) Employment Credit offers a compelling incentive for employers: a 20% tax credit on the initial $15,000 of wages paid to eligible employees. For businesses to qualify, the majority of work performed by these employees must occur within an empowerment zone, directly contributing to the employer's primary business activities. Additionally, it is a requirement that these employees live in the empowerment zone throughout their period of employment.

Even if your business is not situated within an Empowerment Zone or Renewal Community, your organization can take advantage of the Work Opportunity Tax Credit, receiving up to $2,400 for every newly hired employee who is officially recognized as a resident of these areas.

Where are the top Urban Designated Empowerment Zones?

Select areas within the following cities were designated as Empowerment Zones. It's important to note that not the entire city qualifies; rather, only specific segments are included. Below are the major urban centers that feature these designated areas:

Where are the top Rural Designated Empowerment Zones?

The Empowerment Zone Credit is also available in certain rural locations. Specific sections of these rural areas have been recognized as empowerment zones: