Renewal Communities, Empowerment Zones and Enterprise Communities (RC/EZ/EC)

UPDATE: On Friday, December 17, 2010, the President signed the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (Public Law 111-312). Sections 753 and 754 of this law extend the designations of all three rounds of federally designated Empowerment Zones and the District of Columbia Enterprise Zone, retroactively, from December 31, 2009, through December 31, 2011.

The HUD Initiative for Renewal Communities, Empowerment Zones, and Enterprise Communities (RC/EZ/EC) is important to development within distressed urban and rural areas nationwide. The Initiative, through Federal grants, tax incentives, and partnerships with government, for-profit and nonprofit entities, has opened new businesses and created jobs, housing, and new educational and healthcare opportunities for thousands of Americans.

The Gulf Opportunity Zone (GO Zone) Act of 2005 expanded the provisions of the Katrina Emergency Tax Relief Act of 2005 to those affected by Hurricanes Rita and Wilma as well as Katrina. These two laws provide certain tax breaks to help victims of the storms. These laws alter the tax code to help individuals and businesses who suffered losses as a result of the hurricanes.

The Empowerment Zone tax incentives and the Renewal Community tax incentives are worth approximately $11 billion to eligible businesses of all sizes in Empowerment Zones and Renewal Communities. These incentives encourage businesses to open, expand, and to hire local residents. The incentives include employment credits, a 0% tax on capital gains, increased tax deductions on equipment, accelerated real property depreciation, and other incentives.


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