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Last Updated: 12/10/2018

Angel Investment Tax Credit

The Angel Investment Credit is a refundable income tax credit meant to encourage investment in small businesses located primarily in Minnesota and in certain industries. The credit allows you to claim a refund even if you do not owe tax.

Note: The credit is only available through tax year 2017. Certain reporting requirements will continue through 2021.

Do I qualify for the credit?

You may qualify if you are certified by the Minnesota Department of Employment and Economic Development (DEED) before making your investment. Once certified, you’ll receive an Angel Investment Tax Credit Certificate.
Starting in tax year 2015, $7.5 million of the credits are reserved for investors in qualifying businesses that are minority-owned, women-owned, or operated in greater Minnesota.

How much is the credit?

The credit is equal to 25 percent of any new investment in a qualified business up to $125,000 for individuals and $250,000 for couples filing jointly.

How do I claim the credit?

Complete Schedule M1B, Business and Investment Credits. Include both the schedule and the credit certificate when you file your Minnesota income tax return.

For more information about eligibility and certification requirements, see Angel Tax Credit on the DEED website.