The air is buzzing with the passage of SB1124 in the state of Arizona, which includes provisions for an extension of the Small Business Capital Investment Incentive, also commonly referred to as the angel investor tax credit or the small business investment credit. Established in 2006, the program is run by the Arizona Commerce Authority and works to incentivize investment in tech startup companies and early-stage companies.
Over the past six years, economic impact of the program in Arizona is estimated to be at least $1.38 billion. Since its inception, the program has tripled its revenue, compared to the amount of credits approved, and thus is said to be more than proving its value to work as a sort of economic engine. The Small Business Capital Investment Incentive is also one of the few tax credits out there that has earned bipartisan support, passing in the House at 33-22, with two abstentions, and in the Senate with a final vote of 20-9.
Arizona Governor Doug Ducey officially signed SB1124 on July 9, 2021, extending the credit for another 10 years, authorizing $25 million for the program in investor tax credits until June 30, 2031.
With the new provisions, the program is expected to continue to pour into the stateâ€™s economic success and help new companies thrive.
Tech companies and interested parties can reach out to Phoenix-based REDW Principal and Tax Practice Leader Christina Roderick, CPA, MST, CGMA, for advisement on navigating the tax credit for future business tax returns. We welcome your questions. Learn more at redw.com/services/tax/.