The Advanced Industries Investment Tax Credit encourages investments in Colorado advanced industries businesses by providing tax credits to investors.
Investors can earn a state income tax credit for 25% of their investment in a qualified business up to $50,000 on an investment of $200,000 or more. If the advanced industries business is in a Colorado enterprise zone or rural area, investors can earn a state income tax credit of 30% of their investment.
All Colorado investors for a business may be eligible for the tax credit. An investor may also apply for separate tax credits toward investments in different companies, but cannot earn multiple tax credits for investments in the same business.
The State of Colorado allocates $750,000 annually for the Advanced Industries Tax Credit program. Credits are awarded on a first-come, first-served basis, so it is important to apply early as an investor is not guaranteed to earn a tax credit when they make a qualified investment in a certified business.
One company that has taken advantage of the Advanced Industries Tax Credit is Maplewell Energy, headquartered in Lafayette, CO.
Maplewell is an energy technology firm making a world of decentralized energy possible. Their product and services transform military, government, and industrial infrastructure with AI and Digital Twins to maximize operational resiliency, reliability, and efficiency.
Maplewell is currently working with the US Navy and Fortune 500 customers to deliver its product, an advanced energy management system. The platform enables autonomous energy systems within process facilities and maritime assets.
They first applied for the Advanced Industries Tax Credit in 2021 after pre-qualifying as an enterprise zone business.
“Overall, the program has been great for an early-stage investment and encouraged local angel investors to participate,” said Matt Irvin, Chief Executive Officer & Co-Founder of Maplewell. “The tax credit took some risk off individuals and allowed Maplewell to retain more equity early on than if we approached a VC.”
“With the program, we were able to secure investors to make key hires in 2021. These key hires have yielded substantial market traction and enabled growth to prepare us for institution investment in 2022,” Irvin continued. “The OEDIT program was the perfect tool we needed at the stage we were at.”