Who We Are
McGuire Sponsel offers Fixed Asset Services, R&D Tax Credit Services, Global Business Services, and Location Advisory Services. Our firm is committed to providing high-quality service with integrity in a way that helps partner firms bring value to their clients. Our approach has allowed us to become a trusted resource to the industry across the country, with a strong track record with the IRS.
With more than 1,500 clients, we leverage our expertise across industries to deliver solutions that suit the specific needs of each client, no matter the goal.
Economic development incentive is the incentive given by communities to businesses to encourage them to grow their business in that area. In addition, economic development incentives are financial benefits from local, state, or federal governments to help attract or retain business, help promote job creation, or promote new activity. Tax abatements, payroll tax credits, infrastructure grants, and tax increment financing are examples of what are economic credits and incentives. Economic incentives should be considered when a client is considering relocating, expanding, making capital investments, purchasing equipment, and or increasing wages. Any of the previously mentioned variables typically have a significant impact on the business cash flow, operating costs, workforce, and overall profits of a client. Incentives economics, by definition, are something, whether it be money or a prize, offered to make someone behave in a certain way. In this situation, applying the principle of economic incentive to a client receiving a higher tax abatement (incentive), the client will likely choose to expand their business in that location versus others. Incentive economics is defined as financial rewards provided to people to alter consumption and production patterns in an economy. For instance, a client providing jobs with their expansion could be seen as a possible way to change consumption in the local economy, thus creating an incentive for the client to encourage them to choose to expand in their location. In economic terms, opportunity cost is defined as the value you lose when you choose between two or more alternatives. In the application of economic incentives, a client would apply the cost of investing in their opportunity and project along with the cost of not choosing the alternative location(s) and incentives that come along with it compared to the option they decided to choose. Opportunity costs are important for clients to take into account, as the various opportunity costs could have an impact on the overall profitability of a client’s project. The purpose of economic incentives from a client’s perspective on projects is to maximize profits and minimize costs. Other variables, such as community demand, would cause an increase in economic incentives.
How Do Credits And Incentives Work?
Credits and incentives are designed to reduce the amount of taxes owed or increase one’s tax refund. Credits and incentives work by creating an investment and that being compared with possible rewards based upon benefits the investment provides. Credits and incentives a client can receive are based upon their investment and what aligns with their project. There are certain credits and incentives that align with job creation, expansions, equipment purchasing, relocation, and or payroll increase. So, who issues credits and incentives? Credits and incentives are issued by a body of government. Depending on the location of the project, incentives based upon county, town, city, or state would be taken into consideration to maximize incentives and lowest cost opportunity for clients. Credits and incentives are applied for and approved in order to receive one. McGuire Sponsel location advisory services team are able to guide clients through the application process and documentation of the project. Throughout the application process, location advisory services look for the most beneficial opportunity for clients that aligns with company and community values. Many businesses qualify for credits and incentives. Examples include manufacturing, logistics, distribution, e-commerce, and technology. McGuire Sponsel location advisory services support multiple business types, including Fortune 500, private equities, and small businesses. Company headquarters or operations can bring incentives. Investing in real estate can have beneficial incentives. Each incentive is special and based on the needs of each client. Each incentive varies on the program and project. Each new additional job can bring thousands of dollars of investment. Investments tend to receive a percentage back of investments. Credits and incentives are paid over time, depending on the agreement reached. Projects can vary for being paid out from typically three to ten years. Every kind of incentive has a threshold, meaning a minimum requirement is needed to qualify. Some thresholds would be a minimum number of jobs or minimum investment needed to qualify. Credits and Incentives do run ahead of projects. Incentives must be agreed upon before a project reaches a but for and can no longer qualify.
Economic Incentive Example
Economic incentives are defined as financial rewards provided to alter consumption and production patterns in the economy. An example of an economic incentive would be a local government providing a tax abatement to a business planning on relocating to their community to incentivize them to consider moving there. Economic development incentives can help a community and a business at the same time. Communities can develop by increasing local revenue, possibly adding tourism, and creating jobs to circle cash flow. Examples of incentives include tax abatements, tax decreases, grants, income tax incentives, property tax incentives, and sales tax incentives. Government incentives are typically received when a business is creating value for the community. Government incentive programs are analyzed at all levels, including state, regional, county, municipal, and utilities, in order to create the greatest tax savings. McGuire Sponsel looks at the specific region of a project taking place along with what kind of project it is to work with the best option for clients. Economic incentives can last three to ten years, depending on the project. For example, if a client decides to expand their company to another location in a differing state, McGuire Sponsel’s location advisory services would investigate and discover incentives most applicable to their growth projections and situations. Taking these factors into account, the client plans on thirty jobs over five years when adding a new facility in a new region. The client would receive benefits over the five years, credit for each additional job created, and an incentive from the local community or state for deciding to grow their business there. Another example would be a state wanting to increase its production in a specific industry, so it creates an incentive for those industries’ companies to develop in their state. A business then expands in that specific industry to that specific state and receives incentives. Industries that receive the most government incentives are manufacturing, logistics, distribution, e-commerce, and technology. Incentives can be what induces a project.
Industries Good For Credits And Incentives
All industries have the potential to receive credits and incentives. The qualification and the amount of credits and incentives depend on the scope of the project and the project’s location. Some common parameters are the number of net new full-time jobs created, the investment amount, and the location of the project. However, some industries tend to be more favorable due to their specific activities, investment patterns, and economic impact. While the availability of credits and incentives and industries good for credits and incentives can vary by region and jurisdiction, the following five industries are generally good to consider for potential credits and incentives:
Research and Development (R&D) Intensive Industries: Industries that invest heavily in research and development activities, such as technology, pharmaceuticals, biotechnology, and aerospace, often qualify for R&D tax credits. These credits aim to incentivize innovation and technological advancement, providing tax savings based on eligible R&D expenditures.
Manufacturing: Manufacturing industries, including automotive, electronics, machinery, and so on, are often eligible for credits and incentives that aim to promote domestic production and job creation. These incentives can include investment tax credits, job creation credits, and state-specific incentives targeting the manufacturing sector.
Renewable Energy and Green Technologies: Industries involved in renewable energy, clean technologies, and sustainability initiatives can benefit from a wide range of incentives, including investment tax credits, production tax credits, and grants aimed at supporting the adoption of environmentally friendly practices.
Film and Entertainment: Many states and counties offer generous tax incentives to attract film and television productions. These incentives can include tax credits, rebates, or grants to encourage the local film industry and boost economic activity in the area.
Data Centers and Technology Infrastructure: The growing demand for data centers and technology infrastructure has led various regions to offer incentives to attract data center investments. These incentives may include sales tax exemptions, property tax abatements, and credits based on capital investments.
McGuire Sponsel Credits And Incentives
McGuire Sponsel is described as a tax firm that works towards finding tax solutions across the United States. McGuire Sponsel has four practice lines, Fixed Assets, R&D Tax Credits, Global Business, and Location Advisory. McGuire Sponsel Location Advisory is also known to work with credits and incentives. McGuire Sponsel credits and incentives work with providing economic value to clients and communities of projects. Project value can depend on size as well as location. State and local governments have created incentives to attract businesses to grow in their community. A feature of location advisory or credits and incentives is site selection. Our site selection consulting team evaluates the project and finds an optimal location to align with a client’s goals. Different locations provide different economic values. Differing counties, towns, cities, and or states provide different tax abatements, payroll tax credits, infrastructure grants, training grants, or tax increment financing. The seven common factors that go into site selection are workforce, utilities, available sites/buildings, governing practices and regulations, community, tax burden, incentive programs, and local market factors. Examples include the number of projected job opportunities, average wages, community demographics, and utilities. McGuire Sponsel’s location advisory services help with the process of procuring credits and incentives. Procurement involves discovering which credits and incentives can be applicable to a client’s situation based on their investment. The process of procurement takes into account site selection as it applies factors taken into account during site selection to evaluate incentives being procured. Taking into account features of different locations can change the amount procured.
McGuire Sponsel is committed to providing first-class service with integrity in a way that helps partner firms bring value to their clients.
Words From Our Clients
“Our clients are very happy with McGuire Sponsel. They offer a great combination of attributes. They are knowledgeable, thorough, responsive, fairly priced and easy to work with. They can handle large projects and small questions. We’re a “team” both trying to service the clients.”William Richardson, Partner | Sisterson
“McGuire Sponsel has been extremely responsive to both the needs of our firm and most importantly the needs of our clients. They have not only helped us and partnered with us to deliver tremendous value to our clients but they make my job easier by allowing us to draw on the expertise of a team.”Jeff Drummonds, Managing Shareholder | LBMC PC
“McGuire Sponsel’s focus on client service is excellent and it seems obvious to me that they understand everything they are working on for us. I have confidence in what they are recommending.”Brad Hamrlik, Director of Tax | Cortland
“McGuire Sponsel is a true partner to us and we have confidence in their ability to bring value to our clients. In fact, we bring them in without hesitation whenever possible because we know they are a valued resource to our firm”Robert Berger, Partner | Anders
“I am confident in the work they do and know it’s done right. McGuire Sponsel is a top notch firm.”Terry Niegel, Partner | Kernutt Stokes