Bill > S1507

This bill establishes a new tax credit for individuals and businesses investing in small, Massachusetts-based high-technology businesses located in "gateway municipalities," which are defined by existing law as specific cities designated for economic development. A "qualified investment" is defined as cash invested at risk in these businesses in exchange for stock, partnership interests, licenses, or other similar items, provided the investor is not in control of the business. These eligible businesses must be in emerging technology fields like biotechnology, clean energy, information technology, or medical devices, with their principal place of business in Massachusetts and fewer than 225 employees, at least 75% of whom are Massachusetts-based. Taxpayers can receive a credit equal to 10% of their qualified investment annually for up to four years, with a maximum annual credit of $100,000, and any unused credit can be carried forward. However, if the business moves its principal place of business out of a gateway municipality within three years, the taxpayer must repay any credits claimed. The total amount of these credits authorized annually will not exceed $5,000,000 for a five-year period from 2017 to 2021, and the Commissioner of Revenue, in consultation with the Executive Office of Housing and Economic Development, will oversee the program and issue necessary regulations. Additionally, the Executive Office of Housing and Economic Development is required to report on the effectiveness of this tax credit and make recommendations within three years of its implementation.