July 19 - Angel Tax Credit Applications Available

ST. PAUL – Applications for Minnesota’s new angel tax credit are now available from the Minnesota Department of Employment and Economic Development (DEED). The agency will begin accepting these applications immediately.

The new tax credit, which was signed into law by Gov. Tim Pawlenty this spring, provides tax credits to individuals or funds that invest in startups and emerging companies specializing in high technology or new proprietary technology.

“Minnesota has a strong history of developing high-tech companies,” said DEED Commissioner Dan McElroy. “This program will make the state even more competitive in high technology by encouraging private investment dollars that are the lifeblood of promising young businesses.”

Participation in the angel tax credit is a two-step process. Businesses, investors and investment funds must first be certified by the agency in order to participate in the program. Once certified, these entities can then apply for a tax credit allocation. These applications and other details about the program are available at www.PositivelyMinnesota.com/angelcredit.

Under the tax credit, businesses that receive angel funding must be headquartered in Minnesota and have fewer than 25 employees, with at least 51 percent of the workers and total payroll based in the state. Businesses must have been operating for no more than 10 years and cannot have received previous equity investments exceeding $2 million.

The maximum amount of investment qualifying for the tax credit that a business can receive under the new program is $4 million.

Key features of the program for investors and investment funds include:

1. A 25 percent tax credit.

2. A maximum credit of $125,000 per person per year ($250,000 if married filing jointly).

3. Program funding of $11 million in credits in 2010 and $12 million in credits annually from 2011 through 2014.

4. A state refund if credits exceed tax liability.

DEED is the state’s principal economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development. For more details about the agency and our services, visit us at www.PositivelyMinnesota.com.

Upon request, the information in this news release is available in an alternative format such as Braille, large print, audiotape or computer disk.

Minnesota Department of Employment and Economic Development
Communications Office
Phone 651/259-7161 or 1-800-657-3858 ∙ TTY 1-800-657-3973
www.PositivelyMinnesota.com