Bill
A 2365
Raises New Jersey angel investor tax credits to 35% standard and 40% enhanced, caps at $500,000 per investment, boosting funding for emerging-tech ventures.
Status and sponsor
- Bill: A2365 (primary sponsor: Asm. Amy Paulin)
- Introduced: Jan 9, 2024
- Recent actions: Reported with amendments by Assembly committees (Science, Innovation & Technology; Appropriations). Referred to Health (Jan 16, 2025). Substituted by S3189 (2R) on June 30, 2025.
- Current classification: bill (pending further legislative action)
Purpose
- Increase the tax incentives available to investors who make qualified investments in New Jersey “emerging technology” businesses or qualified venture funds, and adjust program eligibility and program-level limits and interactions with the State’s Technology Business Tax Certificate Transfer (NOL) Program.
Key provisions
- Tax credit rates
- Raises the standard Angel Investor tax credit from 20% to 35% of a qualified investment.
- Raises the enhanced credit (for investments in opportunity zones/low‑income communities or certified minority/women-owned businesses, or in funds that contract to invest 50% in diverse entrepreneurs) from 25% to 40%.
- Clarifies the maximum tax credit per qualified investment is $500,000.
- Clarifies credits may be applied in the taxable year or privilege period in which the taxpayer applied for the credit.
- Eligibility changes
- Lowers the employee-size threshold for “New Jersey based” and “New Jersey emerging technology” businesses — roughly from about 225 employees to about 150 employees (statutory drafting appears as reductions from 224 to 149 or from 225 to 150 across drafts).
- Program-level limits and interactions (Appropriations Committee amendments)
- Reduces the Economic Development Authority’s (EDA) fixed annual cap on Angel Investor tax credits from $35 million to $25 million.
- Permits unused surrender capacity from the Technology Business Tax Certificate Transfer Program (the NOL program) to be added to the Angel program’s allowable awards in the following calendar year (i.e., unused NOL transfer authorization can augment the Angel program cap).
- Other changes
- Repeals the New Jersey Ignite Act (an EDA early-stage innovation program).
- Authorizes the EDA CEO to adopt implementing regulations.
Affected parties
- Investors who claim gross income tax or corporation business tax credits for qualified investments.
- Emerging technology businesses and qualified venture funds meeting the revised size and activity tests.
- New Jersey Economic Development Authority (program administration).
- State revenues (and potentially local revenues through economic activity).
Fiscal and timing impact
- Effective immediately on enactment for taxable years/privilege periods beginning on or after the Jan. 1 following enactment.
- Office of Legislative Services (OLS) estimate: a maximum annual State revenue loss of about $15.2 million to $15.7 million beginning in FY2027 (no impact before FY2027 because of tax year timing). This range reflects higher credit percentages applied to historic average qualified investment volumes and prior average awards; OLS notes actual loss likely lower because of the reduced employee-size threshold and because program caps and unused capacity mechanics may limit award growth.
- The bill could also spur additional economic activity that could increase other State and local tax receipts; magnitude of those gains is indeterminate.
Related/companion legislation
- Companion: S3189 (substituted June 30, 2025) and others listed as prior-session or companion bills (e.g., S5705).
Compiled from official sources — confirm details with the bill’s official record.
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