Investment/New Jobs Tax Credit

The Investment/New Job tax credit is a credit allowed on Oklahoma income tax. The credit can be claimed either on an investment in depreciable property or on the addition of full-time-equivalent employees engaged in manufacturing, processing, or aircraft maintenance.

The tax credit can be claimed for up to five years on the greater of 1 percent per year of investment in new depreciable property or $500 per new employee. The credit doubles in officially-designated enterprise zones or if investment exceeds $40 million. In most cases, this credit cannot be claimed in conjunction with Quality Jobs incentives.

In 2018, the credit was claimed on 921 tax returns for a total of $47.0 million, according to data from the Oklahoma Tax Commission’s 2020 Tax Expenditure Report. Unused credits can be carried over to future years; as of Tax Year 2015, there was $557.4 million of unused carried forward credits, according to a 2018 report of the Incentive Evaluation Commission. In response to this accumulation, a temporary cap has been applied to the program that devalues credits to restrict the annual cost to about $25 million per year.