On January 31, 2013, the New Jersey Angel Investor Tax Credit Act was signed into law by Governor Christie in order to encourage investment and growth in New Jersey based technology companies. Under the New Jersey Angel Investor Tax Credit Act an angel investor can receive a refundable tax credit of up to 10% of its investment in a "qualified" New Jersey emerging technology business in order to provide angel investors with additional incentive to back small New Jersey based companies and stimulate growth.
In order for a company to be "qualified" it must:
- Be doing business, employing or owning capital or property, or maintaining an office, in New Jersey;
- Operate in one of the following fields: advanced computing, advanced materials, biotechnology, electronic device technology, environmental technology, information technology, life sciences, medical device technology, mobile communications technology, or renewable energy technology;
- Meet one of the following work or research criteria in New Jersey: have qualified research expenses paid or incurred for research conducted in New Jersey, conduct pilot scale manufacturing in New Jersey; or conduct technology commercialization in New Jersey; and
- Have fewer than 225 employees, of whom at least 75 percent are filling a position in New Jersey.
The credit is subject to a maximum limitation of $500,000 per year for each qualified investment and the total program is capped at $25,000,000 per year for all participants.
The New Jersey Angel Investor Tax Credit Act will enable New Jersey to continue to remain competitive in attracting cutting edge tech companies to the state while simultaneously creating additional jobs and stimulating the economy.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
