The Iowa Angel Tax Credit Program (UPDATE: House to Caucus Monday, May 9th, 2011) helps everyday people invest into startup companies and create more entrepreneurial businesses. I have benefited from a previous program similar to this as well as many other investors and entrepreneurs.
The money that is raised privately and encouraged by this tax credit will create jobs in Iowa that offer greater opportunity for all communities. Please contact your representative and ask them to do what they can to support this bill.
Here is the press release issued by EDC and TAI.
The Entrepreneurial Development Center and the Technology Association of Iowa are supporting Iowa legislation (HSB 234) to fund the Iowa Angel Tax Credit Program. This program is critical to help fund early stage businesses.
Legislation is thought to be voted on tomorrow morning by the House Ways & Means Committee.
House Study Bill 234 would do the following:
- Leverage up to $10 million per year in new seed capital investments in Iowa-based small emerging businesses with high-growth potential
- Help incent capital formation at the earliest stage of company development, which is the most difficult capital to obtain
- Target non-institutional investors for early stage companies – including friends and family, individual angels, angel groups and early stage funds
- Allow for Angel investor tax credits up to $2 million per year (these credits haven't been funded since 2007)
- Angel investors would receive a 20% tax credit – so these credits would leverage $10 million in investment activity
- Place the $2 million under the global tax credit cap put in place in 2010
- Only apply to businesses with a net worth of $5 million – and is truly targeted at the start-up level
- Target small start-up firms, but would not pick winners and losers by targeting specific business sectors
- Many entrepreneurs would rely on these credits to get through early stage growth to the point where larger sources of capital are more interested and available
Note: This program is distinct from the Iowa Fund of Funds, which targets institutional investors for later stage companies.
If you have any questions about HSB 234, please contact TAI lobbyist Mark Joyce at iowa.lobby@gmail.com or 515-238-8860.