Trenton, New Jersey – On Sunday, Governor Murphy signed into law a new measure that seeks to encourage investment into women and minority owned businesses.
Introduced by Assembly members Roy Freiman, Nancy Pinkin, Matthew Milam, Andrew Zwicker and R. Bruce Land, the law increases the Angel Investor Tax credit percentage by a taxpayer into a New Jersey emerging technology business from 10 to 20 percent of the qualified investment.
The law also stipulates that a taxpayer may be allowed a tax credit of 25 percent of the qualified investment if the emerging technology business is located in a qualified opportunity zone, low-income community, or is a certified minority or women-owned business.
“There are so many businesses that have the potential to be successful and to thrive,” said Ms. Pinkin (D-Middlesex). “They just lack sufficient financial backing. This law is designed to help them in their efforts.”
The measure passed the full Assembly last month by a vote of 75-2, and the Senate 37-0.
“New Jersey is striving to have an innovation economy,” said Mr. Zwicker (D- Hunterdon, Mercer, Middlesex and Somerset). “A key component of that economy is financial backing, especially for new businesses looking to be a part of that economy. This law will help make that possible.”
The Angel Investor Tax Credit Program was approved by the Legislature in 2013. The program, which is jointly administered by the Economic Development Authority and the New Jersey Department of Taxation, provides refundable tax credits against New Jersey corporation business or gross income tax for 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.
Currently, the Angel Investor Tax Credit Program provides an angel investor with a tax credit of 10 percent of the qualified investment made in a New Jersey emerging technology business, up to a maximum allowed credit of $500,000 for each qualified investment per tax year.
In 2016, the Legislature created the "New Jersey Biotechnology Task Force" for the purpose of communicating with the biotechnology industry to develop recommendations for steps that the Legislature and State could take to retain and attract new biotechnology companies to New Jersey.
On June 13, 2018, the New Jersey Biotechnology Task Force released a final report of policy recommendations to retain and attract biotechnology companies to New Jersey. One of the legislative recommendations was to enhance the Angel Investor Tax Credit Program.