Welcome to the Community Renewal Initiative

Information by State  Print version   What's New Tax Incentives Assist Academy 2 new restaurants   EZ/RC Good Stories Related Information   Are you in a Empowerment Zone or Renewal Community? Check one address or hundreds using the Address Locator.   Tax Incentives in Empowerment Zones   Tax Incentives in Renewal Communities   EZ and RC Tax Incentives Create Valuable HUD-IRS Partnership   Community Renewal and Tax Incentives Publications   EZ/RC/EC Communities – your source for maps, contacts, census tracts, and more.   Additional Resources Helpful Tools   Spotlight on Results: Capturing Successes in Empowerment Zones and Renewal Communities more...   HUD-IRS Webcast on Tax Incentives for Businesses   Final Rule on Performance Standards for Utilization of Empowerment Zone Grant Funds   Q&As on EZ/RC Tax Incentives   Questions on HUD’s EZ/RC Programs? Call (202) 708-6339 or e-mail us at OCRTaxCredit@hud.gov

HUD's Initiative for Empowerment Zones and Renewal Communities (EZ/RC)

The Empowerment Zone tax incentives and the Renewal Community tax incentives are worth approximately $11 billion to eligible businesses of all sizes in Empowerment Zones and Renewal Communities. These incentives encourage businesses to open, expand, and to hire local residents. The incentives include employment credits, a 0% tax on capital gains, increased tax deductions on equipment, accelerated real property depreciation, and other incentives.

The Empowerment Zone and Renewal Community (EZ/RC) programs are scheduled to expire at the end of 2009. However, in his unwavering efforts to seize the opportunities to create and save jobs through federal programs, such as the EZ/RC programs, President Obama requested in his Fiscal Year 2010 budget that Congress act to extend the EZ and RC designations to December 31, 2010. Extending the designations would allow tax relief to remain available to the 300,000 businesses located in the distressed EZ/RC areas, thereby helping create or retain jobs in high poverty areas, in an environment where the unemployment rate is the highest it has been in 25 years.

It is critically important to extend the provisions immediately rather than allow the EZ and RC designations and the related tax incentives to lapse. Extending the tax incentives retroactively would cause a drop in utilization.

The most widely used Community Renewal tax incentive is the employment credit, which provides tax benefits to businesses that employ residents from the designated areas.  Recent years have shown a steady upward trend in utilization of this incentive. HUD estimates that approximately 480,000 jobs for EZ and RC residents generated over $2 billion worth of employment credits for eligible employers throughout the country in 2007-2008.

Tens of thousands of business owners and tax preparers visit HUD’s Address Locator each month to verify that businesses and the residences of employees are located in these areas.

HUD re-energized the Community Renewal initiative in December 2001 by designating 8 new urban Empowerment Zones and 40 urban and rural Renewal Communities. Together with 22 Empowerment Zones that HUD designated in competitions in 1994 and 1999, these communities share an $11 billion tax-incentive package that encourages entrepreneurs to open new businesses, expand existing ones, and hire local residents.

The leaders of each Empowerment Zone and Renewal Community work closely also with government, business, and local community representatives to implement strategic plans to improve social and economic conditions throughout the designated areas.

In this website you will find historical information on the Community Renewal Initiative, success stories from businesses in Empowerment Zones and Renewal Communities, and information on laws and regulations that apply to these programs. There are detailed maps of these communities and links to tax incentive publications, including IRS Publication 954 on Empowerment Zone and Renewal Community tax incentives.

This website also provides information on resources that other agencies provide to distressed communities through small business assistance, health care, youth services and more. Thank you for your interest in HUD’s Community Renewal program. Please call us at (202) 708-6339 or e-mail us at OCRTaxCredit@hud.gov if you need any assistance.

• Introduction to the EZ/RC Initiative
• HUD's Role in the EZ/RC Initiative
• Principles of the EZ/RC Initiative
• EZ/RC Laws and Regulations
• EZ/RC Initiative Timeline