Shutdown halts signup for angel tax credit
- Article by: WENDY LEE
- Star Tribune
- July 7, 2011 - 6:33 AM
Start-up companies hoping to benefit from Minnesota's angel tax credit program have been unable to sign up investors because of the state government shutdown.
The program offers qualified individuals a 25 percent tax credit on their investments of at least $10,000 in Minnesota start-ups.
"It's a real honest frustration for companies trying to manage a few things," said Scott Hughes, president of Blaine-based Visiam, which supplies processing technology for municipal solid waste management groups.
Hughes said he has talked to three investors who are committed to giving Visiam a total of $200,000, but are waiting to sign up for the angel tax credit program. Hughes plans to use that money to pay back suppliers.
"We've got money waiting on the sidelines," Hughes said.
Interested investors must apply for the tax credit through the Minnesota Department of Employment and Economic Development. But the program "is being suspended until the shutdown is over," according to a message left by angel tax credit program coordinator Jeff Nelson on his answering machine.
'Important to get this done'
This year, the angel tax credit program has generated $28.5 million in investments into Minnesota businesses, according to state data updated June 17.
The shutdown could send investors to other states that have similar tax credit programs, said Margaret Anderson Kelliher, president and CEO of the Minnesota High Tech Association.
"It's important to get this done so we don't lose people who want to invest in Minnesota," Kelliher said.
Minnesota Angel Network Executive Director Todd Leonard said the state shutdown will affect companies' efforts to raise capital, but he believes the state will resume operations soon.
Wendy Lee • 612-673-1712
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