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High-Performance Incentive Program

Rewarding Kansas manufacturers that grow, relocate and invest in employees

Does your company pay above average wages, invest in its people or plan to make capital upgrades within Kansas? If so, your business may qualify for the Kansas High-Performance Incentive Program (HPIP). And with recent changes, HPIP is more accessible than ever.

HPIP is a two-part tax credit that incentivizes and rewards Kansas businesses for:

  • Expanding capital investments in new facilities
  • Offering employee training and education

Kansas manufacturers and certain other types of businesses can claim either the HPIP Incentive Tax Credit or the HPIP Training and Education Tax Credit. Your business must be subject to Kansas income, sales or property taxes; meet certain NAICS code requirements; and pay above average wages for the county or industry.

The HPIP Investment Credit amount is 10% of project costs above and beyond $50,000 or $1 million, depending on location.

The HPIP Training and Education Tax Credit first requires businesses to invest 2% of payroll costs in its own training and education. HPIP kicks in for the rest of the amount up to $50,000 annually.

Adams Brown consults with manufacturers and other businesses determine eligibility for HPIP, calculate the credit amount, and get money back for their growth and development.

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A TAX CLIENT’S PERSPECTIVE…

“I really enjoy working with Adams Brown. The service is great, and the knowledge is awesome. I know my advisor has saved me money over the years.”

Bud Cortner – Sara Cortner Corporation, Wichita, KS

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Non-Manufacturing HPIP Qualifying Kansas Businesses

HPIP is traditionally targeted to Kansas manufacturers. Other companies can qualify for the HPIP Investment Tax Credit provided they make at least 51% of sales to Kansas manufacturers, out-of-state government agencies and/or out-of-state commercial customers. This includes:

  • Utilities
  • Wholesalers
  • Transportation
  • Information (publishing, broadcasting, internet, telecommunications and data processing & hosting)
  • Banking, Finance and Insurance
  • Real Estate
  • Professional Services
  • Education and Health Services
  • Leisure and Hospitality
  • Arts & Entertainment
  • Certain Associations and Civic/Social Organizations

Transferring the HPIP Tax Credit

Beginning with tax year 2021, qualifying companies can transfer up to 50% of the HPIP Investment Tax Credit to any individual or entity. To qualify, the transfer(s) must be made in the same tax year the credit was earned. The tax credit transfer can be used against the other entity’s state income tax liability and can be carried forward up to 16 years.

Transferring the HPIP tax credit can be an effective tool for a manufacturer or other entity that’s unable to take advantage of the full credit.

Businesses with gross receipts of $5 million in the current year can claim the credit against up to $250,000 in payroll taxes.

In either case, the R&D credit can be carried forward up to 20 years.

HPIP Investment Tax Credit Amounts

The HPIP Investment Tax Credit amount varies depending on which county the project is in and when the project occurred. It may be worth examining whether an amended return should be filed to claim the credit prior to 2012.

$50K

10% of project costs above $50,000 prior to 2012 for Douglas, Johnson, Sedgwick, Shawnee or Wyandotte

$1M

10% of project costs above $1 million after 2012 for Douglas, Johnson, Sedgwick, Shawnee or Wyandotte

$50K

10% of project costs above $50,000 after 2012 for any other county

Industry Specializations for the High-Performance Incentive Program

Agriculture Construction Dentists Healthcare Manufacturing Oil & Gas Restaurants
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