Aug 24, 2015
The InvestOhio program provides a non-refundable tax credit that can be used against Ohio’s personal income tax for investors in qualifying Ohio small businesses. It was introduced in September 2011 and has since been renewed for July 1, 2015, through June 30, 2017, biennium. The program was developed to encourage Ohio small business growth and drive job creation.
The credit is a non-refundable Ohio income tax credit which is equal to 10% of the total investment. Investments cannot exceed $10 million and total credits cannot exceed $1 million per taxpayer or $2 million if a joint return is filed. The credit is claimed on the tax return for the year that includes the last day of the 5-year holding period.
Who is eligible?
To qualify all the following requirements must be satisfied:
- At the time of a qualifying investment, the enterprise’s total assets must not exceed $50 million, OR the enterprise annual sales are $10 million or less.
- The enterprise must have a presence in Ohio. More than half of your employees must be in Ohio, OR you have more than 50 full-time equivalent employees in Ohio.
- After making an eligible investor’s qualifying investment, the enterprise invests, or incurs the cost in one of five categories of allowable expenses in an amount at least equal to the amount of the qualifying investment.
A qualifying investment is an investment of money made on or after July 1, 2015, to acquire capital stock or other equity interest in a small business enterprise. It does NOT include equity (cash) an eligible investor derives, either directly or indirectly, from a grant or loan from the federal government or the state.
Eligible investors and businesses must apply and register investments with the Ohio Department of Development to be issued an InvestOhio certificate. Please note, at the time of registration, an application fee will be due. The fee is calculated at the greater of $100 or 0.10% of the investment amount (on a $1 million investment, the possible credit would be $100,000 and you would have to pay a $1,000 application fee).
Contact your William Vaughan Company representative if you have any questions regarding your eligibility or application process.
By: Katie Mokry, Senior Accountant
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