Tennessee Top Credits & Incentives

Incentives are available for companies expanding within the state or relocating to the state.  The amount and duration of the incentives depends on the type of company, number of jobs created and the amount of capital invested.  

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Industrial Machinery Tax Credit

Credit of 1% to 10% for the purchase, third party installation and repair of qualified industrial machinery.

Program Overview


Credit Types

  • Up to 50% of Franchise & Excise Tax

Credit Amount by Investment

  • <$100,000,000 – 1% of investment
  • >$100,000,000 – 3% of investment
  • >$250,000,000 – 5% of investment
  • >$500,000,000 – 7% of investment
  • >$1,00,000,000 – 10% of investment

Carry Forward

  • Unused credit can be carried forward for 15 years

Qualified Industrial Machinery

  • Machinery, apparatus and equipment used for fabricating/processing
  • Accessories and attachments to industrial machinery
  • Repair parts for industrial machinery
  • Installation and repair services for industrial machinery
  • Hydraulic fluids, lubricating oils, and greases for industrial machinery
  • Pollution control facilities required as a result of fabrication or processing
  • Machinery for generating, producing, and distributing utilities
  • Equipment for moving materials to and from the fabrication process
  • Machinery used to package manufactured product
  • Machinery for processing photographic film into negatives or prints for resale
  • Machinery, apparatus equipment, and materials for mining
  • Machinery utilized in pre-press and press operations in printing business including plates, cylinders, fluids and chemicals for mechanical and chemical actions or operations of machinery
  • Machinery, apparatus, and equipment for the conversion of tangible personal property into taxable specified digital products for resale
  • Machinery, apparatus, and equipment used in fabrication of trusses, windows, or door units when primarily engaged in sales of building supplies
  • Machinery, apparatus, and equipment utilized in county or municipality sewage systems and water treatment facilities for water pollution control
  • Machinery for fabrication of asphalt/crushed stone to be used by contractor in roads funded by tax revenues
  • Machinery, apparatus, and equipment for fabricating prescription eyewear, a majority of which is dispensed to patients out of state
  • Computer, computer network, computer software, and computer system used in the operation of a qualified data center

     

    Eligible Industry

     

    • Headquarters — Administrative, research and development, planning, marketing, personnel, legal not manufacturing, distribution, wholesaling or call centers
    • Manufacturing — Principle business is fabricating or processing of tangible property for resale
    • Data Centers — Building or buildings, either newly constructed or remodeled, housing high-tech computer systems and related equipment
    • Warehousing and Distribution — Storage or distribution of finished tangible personal property. Does not include a location where tangible personal property is processed, manufactured, sold to customers or assembled
    • Call Centers — Uses telecommunications in customer service, soliciting sales, reactivating accounts, surveys or research, fundraising, collecting receivables, reservations, taking or receiving orders.

      Authority

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