Kansas extends ‘angel investor’ tax credit; North Dakota mulls changes to its program

Lawmakers in two Midwestern states have given close scrutiny in recent months to a targeted tax credit that has become an increasingly popular policy tool for trying to help entrepreneurs and startup companies. Known as “angel investor” tax credits, these incentives encourage investment in early-stage firms by mitigating some of the potential loss if a company fails. Most states in the Midwest have some form of this tax credit. Kansas’ 11-year-old program was on track to sunset this year, but passage of SB 149 extended it for five years. As a result, individuals can receive a tax credit of 50 percent on their investment in a business that has been in operation for less than 10 years; has gross revenue of less than $5 million; and has an innovative and proprietary technology, product or service.