Colorado · Jobs · CO-JGITC-001
Job Growth Incentive Tax Credit
Publication revised September 24, 2026. Sourcebook page 62.
Credit amount / calculation
Up to 50% of employer-paid federal Social Security and Medicare taxes associated with approved net new jobs, over an eight-year period.
Business fit and eligible activity
Large expansions can negotiate a performance-based credit tied to new jobs and payroll. Hiring, wages or qualifying training; where the program also requires investment, satisfy both tests.
Eligibility and practical use
A mill expansion can meet the capital side of a project easily and still miss a jobs credit because the headcount is too small. That is why this credit should be tested against the actual staffing plan, not the size of the equipment purchase. A logging contractor should confirm that its industry or work location is within the eligible class before counting the jobs. Hiring before the required certification or reservation can jeopardize the credit.
Illustrative business benefit
If an approved project creates 20 qualifying jobs and the eligible employer payroll-tax amount is $91,800 for the year, the 50% calculation is $45,900. The reduced five-job threshold applies in an enhanced rural enterprise zone, not every enterprise zone.
Timing / first action
Seek approval before starting the overall project, including site work or construction. Contact the administering agency and secure the required approval before the project is publicly or contractually committed.
Official sources
- choosecolorado.com — Job Growth Incentive Tax Credit (choosecolorado.com)
Related programs
Enterprise Zone Investment Tax Credit
Three percent of qualified investment in eligible property
Qualifying new sawmill or wood-products production machinery can fit.
Enterprise Zone Job Training Credit
Twelve percent of qualifying investment in a structured
A mill's structured training in scanner operation, kiln controls, maintenance, or other job skills may qualify.
Enterprise Zone New Employee Credit
$1,100 for each qualifying additional business-facility
A qualifying permanent mill or wood-products facility in a zone can fit.
Clean Electricity Investment Credit (Internal Revenue Code §48E)
Generally
Potentially relevant when a forest-products facility owns qualifying zero-emission generation or energy-storage property.
Clean Electricity Production Credit (Internal Revenue Code §45Y)
Production-based
Alternative to the investment credit for owners/operators of qualifying clean-electricity facilities; potentially relevant to qualifying on-site generation.
Credit for Increasing Research Activities (Internal Revenue Code §41)
Regular research-credit method
A sawmill, secondary manufacturer or biomass business can qualify when it performs genuine technological experimentation to improve a product or process.