A corporation, partnership, or sole proprietorship is an enterprise zone business for tax years beginning after August 4, 1997, if all of the following statements are true for the tax year:

• Every trade or business of the corporation or partnership is the active conduct of a qualified business within an empowerment zone (this rule does not apply to the sole proprietorship);
• At least 50% of its total gross income is from the active conduct of a qualified business within a zone;
• A substantial part of the use of its tangible property is within a zone;
• A substantial part of its intangible property is used in the active conduct of the business;
• A substantial part of the employees' services are performed within a zone;
• At least 35% of the employees are residents of an empowerment zone (this rule does not apply to businesses in the DC Zone); and
• Less than 5% of the average of the total unadjusted basis of the property owned by the business is from:
      -Certain financial property, or
       -Collectibles not held primarily for sale to customers.

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