New Jersey recently enacted a refundable angel investor credit that allows companies and individuals to receive a credit for up to 10 percent of a qualified investment in an emerging technology business with a physical presence in New Jersey that conducts research, manufacturing, or technology commercialization, according to a recent Bloomberg BNA Weekly State Tax Reportarticle.
Angel investor credits are designed to encourage investment in certain startup companies. The New Jersey credit may be taken against a taxpayer’s gross income tax liability and corporation business tax liability, notes the article.
In addition to New Jersey, several other states offer similar credits, including Connecticut, Illinois, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Nebraska, New Mexico, North Dakota, Pennsylvania, Vermont, and Wisconsin.
Some states have seen increased investment as a result of the state’s credit program, while others have not, according to a report by the Angel Resource Institute—a nonprofit aimed at sharing best practices for angel investing. For example, the report notes that a 2009 study concluded that Kentucky’s credit is ineffective because only 14 percent of the total authorized credit amount was used in 11 years. On the other hand, Wisconsin’s credit program resulted in the tripling of angel networks and funds since 2004.
Several states have ways of tracking the effectiveness of their credit programs, from reporting requirements to data collection, notes the report. Despite these efforts, the report concludes that “[p]rior studies do not provide any clear conclusion on the effectiveness or lack of effectiveness of angel tax credits.”
For more information about various state angel investor credits, check out Bloomberg BNA’s Business Credits and Incentives Portfolio Series and Individual Income Tax Navigator.
In other developments . . .
A homeowner installing solar energy equipment in two different stages is entitled to a total maximum credit of $5,000, whether the equipment is placed in service at the same time or in stages, the New York Department of Taxation and Finance advised, according to a Bloomberg BNA Weekly State Tax Reportarticle.
By: Kathleen Caggiano
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)