The Angel Tax Credit Program has allocated $12 million in tax credits for investments in more than 80 Minnesota startup companies so far this year, according to the Minnesota Department of Employment and Economic Development.
The agency said an additional $4 million in tax credits is still available for angel investments specifically targeted at startup businesses based in greater Minnesota or owned by women or members of minority groups. Any funding for those targeted groups still unused after Oct. 1 will be made available for investments in other Minnesota startups.
Of the $12 million in tax credits that have been allocated this year, $3.5 million was for investments in businesses based in Greater Minnesota or owned by women or minority members. The $12 million in tax credits will generate $48 million in angel funding for emerging Minnesota businesses.
"The Angel Tax Credit Program is one of Minnesota's most effective tools for attracting early stage investments into emerging small businesses," said DEED Commissioner Katie Clark Sieben in a news release. "Every year we see great demand for this program, and we encourage rural, women and minority entrepreneurs to take advantage of this fantastic resource designated to fuel their business growth."
Under the Angel Tax Credit Program, qualified investors can receive a tax credit of 25 percent on investments of at least $10,000 in emerging Minnesota startups that specialize in high technology, new proprietary technology, or proprietary products, processes or services in the fields of agriculture, tourism, forestry, mining, manufacturing or transportation.
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Through the end of last year, 284 businesses in Minnesota had attracted nearly $250 million in angel funding since the program was launched in 2010.
To encourage more diversity in the program, the Legislature last year reserved $7.5 million of the 2015 tax credits for businesses based in Greater Minnesota or owned by women or minority members. In the past, those targeted groups have been underrepresented when it came to attracting investments through the program.
