Quijano, Schaer, Albano, DeAngelo & Gusciora Bill to Boost Emerging Technology Businesses Advanced by Assembly Panel
By Mel Fabrikant Tuesday, December 11 2012 @ 04:43 PM EST
Legislation Assembly Democrats Annette Quijano, Gary Schaer, Nelson Albano, Wayne DeAngelo and Reed Gusciora sponsored to boost emerging technology businesses and create jobs and economic growth for New Jersey was released Monday by an Assembly committee as part of Assembly Democratic job creation efforts.
The bill (A-1084) is known as the New Jersey Angel Investor Tax Credit Act.
Angel investments are investments by wealthy individuals into high-risk start-up ventures.
“Start-up firms receiving such capital have a significantly higher rate of survival, faster growth and superior access to fundraising than early-stage firms devoid of angel financing,” said Quijano (D-Union). “It’s in New Jersey’s best interest to encourage angel investors to examine and invest in technology start-up businesses, as successful start-ups create jobs, generate wealth and enhance the overall well-being in the state.”
“These types of investors can play a vital part in New Jersey’s economic recovery,” said Schaer (D-Passaic/Bergen). “Some angel investors do not just invest in, but also mentor, coach and assist promising start-up enterprises. This is just the kind of program we need to fill the gaps and create new jobs and economic development throughout our state.”
“This effort is all about jobs and economic development,” said Albano (D-Atlantic/Cape May/Cumberland). “Encouraging this type of investment will go a long way toward jumpstarting our economy and positioning New Jersey as an unquestioned leader in high technology industries.”
“Plans like this that encourage a strong business environment ultimately benefit New Jersey’s hard-working men and women,” said DeAngelo (D-Mercer/Middlesex). “A vibrant business community means better, higher-paying jobs for our working class residents.”
“Emerging technology companies are key to our economic future,” said Gusciora (D-Mercer/Hunterdon). “These companies, if successful, can not only create jobs, but create good, high-paying jobs that we want as we revive our economy.”
The bill establishes credits against corporation business and gross income taxes for investing in New Jersey emerging technology businesses.
Subject to certain limitations, the corporation business and gross income tax credits would equal 10 percent of a taxpayer’s qualified investment in an emerging technology company with fewer than 225 employees, of whom at least 75 percent are filling a position in New Jersey.
Purchase, production and research agreements would qualify as creditable investments.
The program is subject to a $25 million annual cap.
Also, tax credit recipients cannot claim tax credits for that part of an investment in a single company that exceeds $500,000.
If the tax credit amount exceeds a gross income taxpayer’s tax liability, the state will issue a refund to the taxpayer in the amount of the excess, while a corporation business taxpayer may choose between having the amount of the excess refunded or carried forward to be applied against tax liabilities in the next 15 years.
The bill was released 8-2 by the Assembly Budget Committee.