2) Question: Assume a qualified PTDZ business (ABC Company) wholly owns a subsidiary (XYZ Company). ABC Company has no employees and XYZ Company has 20 employees. In order to qualify for the PTDZ credit, must the new employees be hired by ABC Company or
Answer: There are two possibilities for this scenario: 1) The employees may be hired by either ABC or XYZ if they form a single business enterprise as defined by the Department of Economic and Community Development (“DECD”). 2) If ABC and XYZ do not form a single business enterprise, the employees must be hired and employed directly by the qualified entity (ABC Company) in order to be qualified employees. In this case, if ABC Company does not hire any employees engaged in the qualified activity, it will not qualify for PTDZ benefits. If ABC Company does hire qualified employees, all Maine wages paid by both ABC Company and XYZ Company must be included in the denominator of the apportionment factor, but only qualified wages paid by ABC Company may be included in the numerator. For more information about single business enterprise, see the document at http://www.mainebiz.org/whymaine/pdf/singlebusinessenterprisedefinition.pdf
