Memphis Tax Incentives for New Businesses

Taxation and Finance Tennessee 3 Minutes Read · published February 08, 2026 Flag of Tennessee

Memphis, Tennessee offers several municipal and locally administered tax incentives aimed at attracting new businesses and encouraging investment. This guide explains common incentive types, how abatements and payment-in-lieu agreements typically work, who administers and enforces them, and practical steps to apply or appeal. It is focused on city-level programs and local procedures rather than state-only grants; where municipal code or official program pages are the controlling sources, those pages are noted for reference.[1]

Types of incentives commonly available

Local incentives in Memphis may be structured to reduce upfront costs or ongoing taxes for qualifying projects. Typical categories include:

  • Property tax abatements and exemptions tied to new construction or rehabilitation
  • Payment-in-lieu of taxes (PILOT) agreements that replace standard property tax with negotiated payments
  • Tax increment financing (TIF) or special project financing for public improvements
  • Sales and use tax exemptions for qualifying equipment or construction materials when allowed
  • Fee waivers or expedited permitting for priority projects
  • Targeted incentives tied to job creation, wages, or investment thresholds
Incentive packages are typically negotiated case-by-case and often require commitments in writing.

How incentives are authorized and who administers them

City-level incentives in Memphis are implemented through agreements, ordinances, and program guidelines managed by local economic development authorities and city departments. Specific authorizing instruments, eligibility rules, and any required municipal ordinance or resolution are recorded in the municipal code or the adopting ordinance on file with the city or the designated development authority.[1]

Penalties & Enforcement

Enforcement for incentive agreements and abatements is typically contract-based and may involve clawback provisions, repayment obligations, and administrative remedies if a recipient fails to meet performance conditions.

  • Fine amounts: not specified on the cited page.
  • Escalation (first/repeat/continuing offences): not specified on the cited page.
  • Non-monetary sanctions: possible rescission of abatements, repayment demands, and termination of agreement.
  • Enforcer: City of Memphis departments and any designated development authority or trust that executed the incentive agreement; specific enforcing office depends on the program.
  • Inspection and compliance: performance reports and site inspections may be required by the agreement.
  • Appeals/review: appeal routes are typically through administrative review or court challenge; time limits are not specified on the cited page.
  • Defences/discretion: common defences include force majeure, documented compliance efforts, or approved variances; program or agreement language governs discretion.
Specific penalties and time limits depend on the executed agreement or ordinance and must be checked in the authorizing document.

Applications & Forms

Where municipal incentives are available, applicants generally submit an incentive application or proposal package to the city or to the local economic development authority along with project pro forma, job estimates, and financial disclosures. The city file or program page should list the exact form name and submission instructions; the cited municipal code page does not publish a single universal form name.[1]

Action steps for new businesses

  • Contact the City of Memphis economic development office or the designated development authority to request program guidelines and application procedures.
  • Prepare a project summary, including investment amount, projected jobs, and timeline.
  • Submit the incentive application and required attachments by the program deadline or as instructed by staff.
  • If offered, review the proposed agreement for clawback, reporting, and appeal language with legal counsel before execution.
Apply early and provide clear job and investment projections to improve the chance of approval.

FAQ

What types of projects typically qualify for abatements?
Projects that create jobs, involve significant new investment, or redevelop blighted property often qualify; exact eligibility criteria are program-specific and set by the authorizing ordinance or agreement.
How long do abatements usually last?
Duration is set in each agreement or ordinance and varies by program; the municipal code page cited does not list standard durations.[1]
Who can I contact to start the application?
Begin with the City of Memphis economic development office or the locally designated development authority; contact details are provided in the Help and Support / Resources section below.

How-To

  1. Contact the City of Memphis economic development office to request program guidelines.
  2. Assemble the application package: project summary, financials, and job projections.
  3. Submit the application and follow up with staff for any requested clarifications.
  4. Negotiate terms if offered and review all agreement language before signing.

Key Takeaways

  • Memphis incentives are often negotiated and tied to verifiable job and investment commitments.
  • Enforcement and penalties depend on the executed agreement; check the authorizing ordinance for specifics.

Help and Support / Resources

  1. [1] City of Memphis Code of Ordinances (Municode)

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