The Minnesota Department of Employment and Economic Development (DEED) has started accepting applications from businesses, investors and funds to participate in the Minnesota Angel tax credit program. The Minnesota legislature authorized $10 million in tax credits for 2019, with another $10 million in 2021.
Half of the funding each year is reserved for minority, women and veteran owned and managed businesses, as well as businesses located in rural Minnesota.
“The Angel tax credit is an essential investment in Minnesota’s economy and our future,” said Gov. Tim Walz. “Our state has a long history of innovation. By directing capital to the small businesses and start-ups that can use it best, we are creating the next generation of successful innovators based right here in Minnesota.”
"These tax credits are an excellent opportunity for Minnesota businesses to raise the capital they need to grow,” said Steve Grove, DEED commissioner. “When we invest in start-ups and small businesses we grow employment, we grow our economy and we lay the groundwork for a future in which Minnesota is a national leader in the innovation sector.”
The program is now part of Launch Minnesota, a new initiative to grow Minnesota’s start-up ecosystem. The program provides a 25 percent credit to investors or investment funds that put money into start-up companies focused on high technology, new proprietary technology, or a new proprietary product, process or service in specified fields.
The tax credit stimulates private investments in emerging Minnesota businesses in an effort to encourage job creation.
Since its inception in 2010, the Angel tax credit has provided $418 million in investment to 430 start-up businesses. The program ended in December 2017 due to its sunset provision before being reinstated in 2019.
The minimum qualifying investment is $10,000 for non-targeted businesses. The minimum qualifying investment for women/minority/veteran and rural Minnesota businesses is $7,500.
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, visit mn.gov/deed.