A state program meant to spur more investment in Minnesota start-ups has proven so popular, it will run out of incentives to give investors in early December.
The Minnesota Angel Tax Credit program offers qualified individuals a 25 percent tax credit on their investments of at least $10,000 in Minnesota start-ups. Jeff Nelson, the program's coordinator, said on Thursday the program is expected to run out of the tax credits allocated for this year in five to six weeks.
"I am very pleased that the program is proving to be so popular," Nelson wrote in an e-mail. "... Countless participating companies have told me that without the credit, they would not have been able to get funding."
So far this year, Minnesota start-ups have received $53.2 million in investment under the program, Nelson said. But once this year's $16 million in tax credits runs out, the program will not be able to give more tax credits until Jan. 1.
That could cause an inconvenience for some entrepreneurs, said Lois Josefson, executive director of entrepreneurial support group TiE Minnesota.
"It is never good when a company is in need of resources, to wait any longer than they have to," Josefson said.
During this summer's three-week state government shutdown, some entrepreneurs were concerned they could lose investors during the period of time when they didn't have access to the program.
