Business Advantages

 

Ames Offers a Favorable Business Climate
The business climate in Ames and the state of Iowa has never been more favorable. Companies operating here benefit from a business-friendly state government, technology transfer from world-renowned research institutions, a skilled and productive workforce, and a centralized geographic location. The proof is in the numbers. 

Ames and Iowa Rank...

• Ames is ranked as one of the Best Places to Launch a Business (CNNMoney.com, 2009)
• Ames is ranked as one of the Best Places to Raise Your Kids (Business Week, 2009)
• Ames is ranked as one of the Top 15 Cities for Commuters (US News, 2009)
• Ames is ranked as one of the Top 5 Places to Live a Stress-Free and Simpler Life (AARP, 2009)
• Ames is ranked the Third Best College Town (American Institute for Economic Research, 2009)
• Ames is ranked one of 50 best small cities for startups (Business Week, 2009)
• Ames is ranked 53rd Best Place to Live in America (Money Magazine, 2008).
• Ames is recognized as one of the 100 Best Communities for Young People (America’s Promise Alliance, 2008).
• Ames rated the 6th Smartest City in America (Forbes.com, 2008).
• Ames chosen for “Tourism Community of the Year” (Iowa Department of Economic Development, 2008)
• Ames named one of the best places to raise your kids (BusinessWeek, 2008)
• Ames selected as “One of the greatest places you’ve never heard of” (Mother Earth News, 2008)
• Iowa was ranked the 14th best state to find a job (CareerBuilder.com, 2008).
• Story County was listed 2nd in “Best Places to Live a Long Life” (CNNMoney.com, 2008) 
• Ames was selected as a "Five-Star Quality of Life Metro" (2007 Quality of Life Quotient, Expansion Management Magazine).
• Named one of the best 10 places to retire young (CNNMoney.com, 2007)
• Ames was selected as a "Five-Star Knowledge Worker Metro" (2006 Knowledge Worker Quotient, Expansion Management Magazine).
• Ames has been named a Mayor's Challenge Five-Star Business Opportunity Metro (Expansion Management, 2006).
• Fifth nationally for most educated workforces (Business Facilities Magazine, 2006).
• 10th lowest in the nation in firm termination/business closings (Development Report Card for the States, 2006).
• Fourth best on the State Liability Systems Ranking (Harris Interactive, Inc., 2006). 
• Ames is one of the Best Performing Cities on the list of Where America's Jobs Are Created (Milken Institute, 2005).
• 10th lowest for Workers' Compensation Costs with an average cost of $2.94 per $100 of payroll (Actuarial & Technical Solutions, Inc., 2005)
• Third lowest in Cost of Doing Business in the nation (Cost of Doing Business Index:  Milken Institute, 2005).
• 17th best on the State Competitiveness Index (Beacon Hill Institute of Suffolk University, 2005).
• 10th highest for University Research & Development expenditures with $169.38 per capita (Development Report Card for the States, 2004).
• Eight of Iowa's largest communities ranked Best Places for Business (Forbes Magazine, 2004)

Key Business Advantages
At A Glance

Corporate Income Tax	Based only on income from sales to Iowa customers.  50% deductibility from Federal Taxes.
Property Tax	No tax on machinery, equipment, and computers.
Sales Tax	No tax on the purchase of machinery and equipment.
Utilities Sales Tax	No tax on utilities used during the manufacturing process.
Inventory Tax	No tax on inventories.

Iowa Corporate Income Tax
A number of features of Iowa's corporate income tax offer significant advantages, including:
• 50% deductibility of federal taxes from Iowa corporate income.
• Single-factor, non-unitary tax - Iowa's tax is based only on the percentage of total sales income within the state.
• Iowa corporate income tax may be reduced or eliminated by the New Jobs Tax Credit, High Quality Job Creation Program, or Enterprise Zone benefits.

No Personal Property Tax
Personal property is not assessed for tax purposes.  In Iowa, personal property includes corporate inventories of goods-in-process, raw materials, and salable goods.

No Sales and Use Tax on Industrial Machinery and Equipment Purchases
The purchase of industrial machinery, equipment, and computers used for manufacturing or used to process data by insurance companies, financial institutions, or certain commercial enterprises, is exempt from Iowa sales or use tax.  In addition, there is no sales tax on materials used in the manufacturing process or for purchase of electricity or natural gas used directly in the manufacturing process.

No Property Tax on New Industrial Machinery and Equipment
Industrial machinery, equipment, and computers are exempt from property tax.

Research and Development Tax Credit
A refundable credit for increasing research activities is up to 6.5 percent of the company's allotted share of qualifying research expenditures in Iowa.  A company must meet the qualifications of the federal research activities credit in order to be eligible for the credit on the Iowa return.  Companies approved for expansion in an Enterprise Zone or under the High Quality Jobs Creation program may be eligible for the amount of the tax credit to be doubled for qualifying research and development activities.

Workers' Compensation
Iowa's workers' compensation costs are among the nation's lowest.  The average cost of worker's compensation insurance for manufacturers in Iowa is 28 percent lower than the national average.  Iowa law provides for employer choice of doctor.

Unemployment Insurance
Iowa has one of the lowest new employer unemployment insurance rates in the nation.  In 2006, the rate for all new non-construction businesses in one percent.

View information about financial assistance available to new or existing businesses.  More...


Source:  Iowa Department of Economic Development