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Invest Ohio Tax Credit

Post date
July 08, 2014
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Provided By: Skoda Minotti 

InvestOhio is a tool for helping Ohio small businesses gain the capital they need to succeed and create jobs. Through the program, individuals who invest up to $10 million in eligible small businesses may receive up to a 10 percent non-refundable personal income tax credit if the investment is held for five years. The credit is issued on a first-come, first-serve basis. 
 
The Director of the Ohio Development Services Agency is authorized to award up to $100 million in tax credits during the current state of Ohio fiscal biennium. 
 
What is an Eligible Investment? 

  •  Eligible investor must infuse new equity (cash) into an eligible Ohio Small Business to acquire an ownership interest. Investments made between July 1, 2013 and June 30, 2015 can qualify
  • Small Business is required to reinvest the infusion of cash into 1 of 5 categories of 
  • allowable expenses within 6 months
  • Investor must maintain interest for 5 years and small business must retain property purchased for 5 years before the credit can be claimed for investments made before June 30, 2015
  • Investments that qualify for other state credits cannot also be used for InvestOhio. Only one credit will 
  • apply

What is an eligible Ohio Small Business? 
 
On the investment date and six months after, eligible companies must have: 

  • Less than $50 million in assets OR less than $10 million in annual sales (related or affiliated entities shall be included in the calculation) 
  • Have at least 50 full-time equivalent employees in Ohio OR at least 50% of its total employees in Ohio. 
  • The employees must be Ohio tax withheld. 
  • Must contain an active trade or business. 
  • Must be registered with the Secretary of State, if applicable, and in good standing. 

Who is an Eligible Investor? 

  • Eligible investors include individuals, estates, trusts and pass-through entities that file and pay Ohio income tax. 

What is an Eligible Expense? 

  • Tangible personal property (used in business and located in Ohio) 
  • Motor vehicles (purchased, registered and primarily use for business in Ohio 
  • Real property (located and used in business in Ohio) 
  • Intellectual property (patents, copyrights, trademarks) 
  • Compensation for newly-hired or retained employees (excluding increased compensation for owners, officers or managers) for whom the enterprise is required to withhold Ohio income tax. InvestOhio Tax Credit 

For more information, please contact Amy Gibson, CPA, Principal, at [email protected] 
440-449-6800 or visit our website at skodaminotti.com.