Small Business Incentive Programs in Tennessee

Agency: USDA Rural Development Tennessee

This USDA program provides funding for small businesses in rural Tennessee communities to support job creation, business expansion, and economic development initiatives. The grants can fund equipment purchases, facility improvements, and working capital needs for qualifying rural businesses.

Agency: Tennessee Department of Economic and Community Development

This state program supports small business development in rural Tennessee communities through grants and low-interest loans. The fund targets businesses that can demonstrate job creation potential and contribute to diversifying rural economies through manufacturing, technology, or value-added agriculture initiatives.

Agency: Small Business Administration

The SBIR program provides federal funding for Tennessee small businesses engaged in research and development with commercialization potential. Phase I awards support feasibility studies, while Phase II funds full development projects, making it ideal for technology-focused LLCs developing innovative products or services.

Agency: Tennessee Housing Development Agency

This program provides microloans and technical assistance to very small Tennessee businesses, particularly those owned by low-to-moderate income entrepreneurs. The funding supports business startup costs, equipment purchases, and working capital needs for microenterprises that may not qualify for traditional bank financing.

Agency: Tennessee Department of Economic and Community Development

This federally-funded state program supports business development projects that create jobs for low-to-moderate income workers in Tennessee communities. The grants can fund infrastructure improvements, equipment purchases, and facility development that support business expansion and job creation in economically disadvantaged areas.

Tennessee Job Tax Credit

This credit provides tax relief for businesses creating new full-time jobs in Tennessee. The credit amount varies based on the county's economic status and ranges from $1,000 to $4,500 per qualifying job created.

Eligibility: Businesses creating at least five new full-time jobs with benefits in qualified counties. Jobs must pay at least the county average wage.

Tennessee Industrial Machinery Tax Credit

Businesses can receive a tax credit equal to 1% of the cost of qualified industrial machinery purchased for manufacturing operations. The credit helps offset the franchise and excise tax liability for qualifying equipment investments.

Eligibility: Manufacturing businesses purchasing new industrial machinery and equipment for Tennessee operations. Equipment must be used directly in the manufacturing process.

Research and Development Tax Credit

Tennessee offers tax credits for qualified research and development expenses incurred within the state. The credit equals a percentage of qualifying R&D expenditures above a base amount from previous years.

Eligibility: Businesses conducting qualified research activities in Tennessee. Research must be technological in nature and intended to develop new products, processes, or software.

Tennessee Headquarters Relocation Credit

Companies relocating their headquarters operations to Tennessee may qualify for substantial tax credits based on job creation and capital investment commitments. The credit can significantly reduce franchise and excise tax obligations.

Eligibility: Businesses relocating headquarters operations from another state to Tennessee with minimum job creation and capital investment requirements. Must demonstrate significant economic impact.