What is the Connecticut Angel Tax Credit and How Do You Qualify for It?

What is the Connecticut Angel Tax Credit and How Do You Qualify for It?
What is the Connecticut Angel Tax Credit and How Do You Qualify for It?

Connecticut business owners are always looking to find ways to save money. That makes sense. And, you’d be surprised at how many tax credit programs are available to small business in Connecticut. Most people don’t know about these programs unless they specifically ask their business lawyer or accountant about them. And, if you don’t know to ask, you’ll never learn of these opportunities.

One of these such opportunities is the Angel Investor Tax Credit. This is a program where you can get a 25% tax credit if you invest at least $25,000 in a start-up business within the state.

In order to qualify for this program, you must meet the following criteria:

  • Your annual revenue is less than $1 million
  • You have less than 25 employees
  • 75% or more of your employees are residents of Connecticut
  • Your company hasn’t received more than $2 million in money from other Angel Investors

The important thing to know is that you have to apply for the program and be approved before you make an investment. If you have already invested the money, you will be qualify for this lucrative tax credit.

You can invest anywhere from $25,000 to $1 million. This is the dollar range for qualifying investments. It’s also important to know who isn’t eligible for this program. You cannot take part in the Angel Investor Tax Credit program if you fall into the following categories:

  • Your company is any of the following:
    • Bank
    • Savings and loan
    • Insurance company
    • Venture capitalist
    • Trust
  • You or your business partners have a 50% ownership interest in the start-up company that will be the recipient of your investment.

If you’re interested in learning more about this program, or you believe you may qualify for the credit, call our business lawyers right away to discuss.

Source: https://portal.ct.gov/DECD/Content/Business-Development/06_Tax_Incentives/Tax-Credits/Angel-Investor-Tax-Credit

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