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IDA

Sales and Use Tax Exemptions

Real Property Tax Abatements
Mortgage Recording Tax Exemptions

The Agency can offer exemptions from sales tax on materials purchased during the construction of a qualified project and for equipment for the project. The Agency issues a sales tax letter to the project owner or lessee which provides to vendors a description of the Agency project and informs them that the project owner or lessee is an agent of the Agency for the purposes of completing the project and, therefore, no sales tax is imposed on any property within the scope of the Agency project. The sales tax letter is limited in time and solely to the Agency project. In Orange County, the applicable sales tax is 8.125%.

Alternatively, a 485-b tax abatement is available from most municipalities and School Districts on the tax to be paid on improvements to the land or an existing building. 50% reduction in local taxes in Year 1, 45% reduction in Year 2, and so on until Year 11 when 100% of the taxes are paid by the company.